India: Imported Scrap Offers Stable at USD 370/MT CFR

Containerized Scrap (HMS 1&2) continues to offer at around USD 370-372/MT CFR India for the 3^rd week.

Despite improved buying interest for Scrap in the global market and low supply of Sponge iron in the domestic market, imported Scrap offers in India remain stable. Falling steel prices in the domestic market were unable to create buying interest in mills. Offers here in India, have currently stuck at USD 370-375/MT levels CFR Nhava Sheva.

At present, Middle East is offering HMS 1&2 at around USD 370-372/MT CFR Nhava Sheva and Europe at USD 370-375/MT. Buyers are averse to take position at these levels owing to dull demand in market. Offers for European origin Shredded Scrap are floating at around USD 395-400/MT. However, buyers are showing interest at USD 390/MT levels.

A deal of around 16 containers of HMS 1&2 was confirmed to be sold from Middle East at USD 372/MT CFR Nhava Sheva, which is expected to deliver within 15 days.

Falling Iron Ore Prices in Global Market- A threat

Spot Iron ore prices, hitting almost five year low in the global seaborne market, may put some pressure on Scrap prices as well. Analysts anticipate global Iron ore prices to fall further, which will help Chinese steel manufacturers to offer their products across the globe at very competitive prices. 

Pig Iron over Scrap 

Price parity between Pig iron & Scrap is also emerging as concern for Indian steelmakers based in eastern region. Mills prefer Pig iron over Scrap, as its prices have touched almost 1-year low.

A smelter based near Jalna shared, “We are defying import of Scrap and are now totally running our mills on domestic Scrap. Imported offers are very high as per the demand in the domestic market. Rest of the requirement is fulfilled from Sponge & Pig iron.”

Smelters have continued to run mills at below capacity (8-12 hours working) levels – observing the ongoing dull demand. They believe market to remain sluggish for rest of the September.