Imported Scrap Offers to India may fall further

Imported Scrap offers to India are anticipated to fall further amid falling Steel and Scrap prices in the domestic market. Steel (Ingot & Billet) prices  have corrected by up to INR 1,000/MT (USD 16/MT) in last one week and expected to fall further.

Steelmakers in North India, which is the largest consuming region of imported Scrap, are hesitating to take position looking at fall in steel prices. This has put Scrap importers/traders under pressure. While talking to a Scrap importer based in Mumbai in this concern, he shared, “We are planning to route the material to Western & Southern markets, which we had imported with intention to sell in North India, projecting bullish demand in near-term. But, currently we are unable to find courage among mills to take position in North.”

Imported market in Chennai as of now is very dry and routing the imported Scrap to this market may further create price pressure as a result of oversupply.

Current offers for HMS 1&2 from Middle East are assessed at USD 305/MT, from Europe/UK at USD 300-305/MT and West Africa at USD 290-295/MT on CIF West Coast India, with inquiries at USD 5/MT lower from these levels. While, Shredded Scrap offers are assessed at USD 320-325/MT, CIF India and Turing & Boring at USD 270/MT, CIF India.

Offers to Pakistan slip down
HMS 1&2 offers have fallen to USD 305-310/MT, CIF Pakistan from USD 312-315/MT levels.
Low demand and falling global steel prices are dominating the concerns for steelmarkers in the country.

Despite hike of 15% in import duty of steel products, Pakistan market has failed to show any enthusiasm for import of Scrap. Buying interest in past few weeks from Pakistan brought some confidence in Global Scrap suppliers, but now, the selling pressure can be easily realized in the market.

Trade-wise

1. HMS 1&2 offers are assessed at USD 305/MT, CIF India, while, buying is noticed at around USD 295-300/MT, CIF India
2. Indian trader sold African HMS 1&2 at USD 292/MT, CIF India
3. Japanese CRC Bundled Scrap offer is assessed at around USD 345-350/MT, CIF India
4. UK based exporter is offering Shredded at USD 320-325/MT, CIF India
5. Coal based Sponge iron from Vietnam is being offered at USD 300/MT, East Coast of India
6. Imported Billet offers from China are heard to be at USD 400-405/MT, CIF India levels

In outlook, imported Scrap offers may suffer price bargain of upto USD 8-10/MT in near-term on the backdrop of emerging oversupply and selling pressure in the market.