India: Imported scrap prices remain high in limited trading

With the latest Turkish trade offers climbing up, global scrap prices remain on the upper side. The Indian imported scrap trade remained subdued on high offers and a sluggish finished steel market. The steel industry has been impacted by the current spate of lockdowns. Consequently, subdued finished steel sales have kept market sentiments bearish, SteelMint learnt.

• SteelMint’s assessment for containerized shredded scrap of UK/Europe-origin stands at $525-530/tonne (t) CFR Nhava Sheva, up by around $5/t week-on-week (w-o-w). Hardly any deal for imported shredded scrap was reported this week as sellers preferred selling in Bangladesh and Pakistan amidst higher prices and acceptability at $545-550/t CFR Chittagong and $525/t CFR Port Qasim respectively.
• On the other hand, UAE-origin HMS 1 is now being quoted at $505/t CFR. Gujarat-based mills remained active in booking Dubai-origin HMS. A deal of 2,000 t of UAE-origin HMS 1&2 (90:10) was heard at $505/t CFR basis, early this week.

Domestic scrap prices likely to be under pressure on weak fundamentals
Domestic scrap prices witnessed slight adjustments in sync with semis and finished steel movements, with prices shrinking across major scrap markets. The western region was reportedly impacted by a considerable correction in semi-finished steel prices. In the near-term, prices could be seen narrowing down further, trade sources told SteelMint.

SteelMint’s assessment for HMS in western India is at INR 36,000/t DAP Mumbai, down by INR 900/t w-o-w, and the same is at INR 35,900/t DAP for Jalna, down by INR 800/t w-o-w.

Secondary rebar prices subdued on weak demand
Induction furnace (IF) grade rebar prices declined further in most of the major markets in India, SteelMint’s assessment shows. Limited trade volumes and production cuts, following rising inventory at mills, may keep rebar prices under pressure in the near term, sources said.

According to SteelMint’s assessment, induction furnace (IF) grade rebar prices in Mumbai stand at INR 49,300/t exw, down significantly by INR 1,600/t w-o-w.

Outlook
Buyers have adopted a wait-and-watch policy and expect prices to come down by over $20/t because of limited buying and the decline in Chinese steel prices. However, suppliers have not indicated the lowering of offers. It would be interesting to see how things pan out in the near term.