SteelMint learned from industry participant that very limited deals for imported scrap are being reported in Indian market at present. In the opening of this week, few trades were reported in containers by leading buyers based on the western coast and it was expected to bring some momentum in the market, however, that seemed not happening towards the closing of the week on a cautious approach being taken by both suppliers and buyers side at the moment.
SteelMint’s assessment for containerized Shredded from Europe, UK and US stand in the range USD 330-335/MT, CFR Nhava Sheva, narrowing down against USD 335-337/MT last week. Availability of offers remained limited as suppliers remain waiting for more clarity on global prices.
A steelmaker based on west coast booked containerized scrap comprising Shredded from Europe and US at around USD 330-332/MT, CFR Nhava Sheva, South African HMS 1&2 at around USD 335-338/MT, CFR and HMS 1 from Dubai at around USD 325-327/MT, CFR depending on quality.
P&S scrap from UK was being quoted around at USD 340-345/MT, CFR Nhava Sheva while trades for Central American HMS 1&2 (80:20) scrap reported at USD 322-325/MT, CFR to Mundra and Ludhiana.
Trades for HMS 1 from Dubai has been reported in the range of USD 330-335/MT, CFR Nhava Sheva depending on quality. West African HMS 1&2 traded in 20-21 MT containers at around USD 313-315/MT, CFR Goa and around USD 310-313/MT, CFR Chennai.
Why has Indian imported scrap market remained dull?
1. Easier and cheaper availability of substitutes – A trade sources highlighted that, few mills are preferring other cheaper alternatives like domestic scrap, sponge iron and DRI for steelmaking.
“Sponge iron prices in Indian domestic market have been lowered by around INR 200-400/MT over the last weeks’ period this results in most of the steelmakers to prefer sponge iron in a larger proportion than ferrous scrap as a feeding blend. Many steelmakers have increased usage proportion of sponge iron at the moment” shared a source.
Price assessment of local HMS 1&2 (80:20) scrap stands at INR 25,000-25,200/MT (USD 361-364), ex- Mumbai, marginally down by INR 200/MT against last week report. USD/INR exchange rate remained range bound this week between low 68.8 to high 69.5 on weekly premises.
2. Ongoing general elections – Most of the large quantity buyers have already been sold out and facing less cash flow issues. Suppliers remain less interested to sell on a credit basis for large L/Cs. Also, upcoming elections kept the market uncertain and in the subdued state.
3. Starting of monsoon immediately after the election to pull sentiments down – Usually, construction activities in June-July months in India slow down as monsoon hit the most of the coastal regions and it also impacts transportation within the country.
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