Imported Scrap Offers rise to India despite low Demand

Imported Scrap offers to India inflate by USD 5/MT. However, no buying is seen at such high levels.

Scrap offers from Europe have risen by USD 5-7/MT and are around USD 280-285/MT (HMS 1&2) and USD 300-305/MT (shredded), CFR India. Increase in demand of European scrap in Turkey and other nation in the EU has led to such price hike.

Following suit, suppliers in Middle East have also raised their fresh offers to USD 300/MT (HMS 1&2 of 22 tonnes loading) and USD 305-310/MT (HMS 1 of 25 tonnes loading). However, suppliers trading with piled stocks are still offering the material at USD 295/MT & USD 300-305/MT respectively.

An importer based in Delhi said, ”Scrap supply was stuck because of the pending decision on PSIC from DGFT. Now when the market has got a signal of a roll back, suppliers want to begin at a higher note to recover the loss which is why offers are up by USD 5-10/MT.”

However, the final rule with amendments are to be set on 24 Apr’15 on Foreign Trade policy (FTP) 2015-2020 from DGFT.

Currently Scrap suppliers across the globe look bullish, while buyers in Indian market are still dull.

A Scrap consumer in Gujarat stated, “Though the offers have inched up owing to suppliers’ obvious reasons, buyers in India don’t find the offers workable. Hence, no active buying is seen in the market.”

Offers for Shredded scrap from US were also heard to have charged up by USD 2-3/MT at USD 295-297/MT, CFR India.

Scrap Imports increased in FY15

Ferrous scrap imports in India rise by 15% Y-o-Y, with total imports around 5.2 MnT. South Africa was the highest Scrap exporter to India in FY15, contributing around 17% of total Scrap import followed by UAE(16%) & UK(15%). While Ludhiana ICD became the highest Scrap importing port in India with 24% of total imports, followed by Chennai (20%) & JNPT (16%).

Global Scrap prices as on 16 Apr’15

Source: SteelMint Research