Indian Importers Expect Rise in Scrap Prices

1. Seaborne scrap offers are likely to surge by USD 5-10/MT on low supply
2. Turkey resumes buying at higher prices
3. Supply from US/Europe will go down in December due to festive season
4. Indian buyers in dilemma

Imported scrap offers to India may move up by USD 5-10/MT on low supply

Imported scrap offers to India may notice some uptick on account of low supply. Participants mentioned that current offers for shredded scrap (ISRI 211) have gone up to USD 195-205/MT, CIF India from US and Europe. Whereas, HMS 80:20 offers are in the range of USD 185-190/MT, CIF India and P&S at USD 212-215/MT, CIF India.

HMS 80:20 offers from South Africa and Middle East are hovering in the range of USD 200-205/MT, CIF India.

“Offers to India will move up due to low supply in global market. Increased prices in Turkey has given some support to market. Indian buyers are still hesitant to take positions. Suppliers are getting better realizations from Pakistan and Bangladesh market”, said an indenter based in Mumbai.

Turkey resumes buying at higher prices

Tight supply of scrap in global market has led to price hike. Offers for HMS 80:20 in Turkey have increased to USD 180-185/MT, CFR. No sellers are ready to sell their material below USD 180/MT, CFR levels.

It is to be noted that scrap mills/suppliers had reduced their operation and collection capacity to 50% owing to increased difficulty in operation along with continued fall in prices.

Supply from US/Europe will go down in December  

Scrap supply from US and Europe usually slows down in December due to festive season and extreme weather conditions. The country goes for 15-20 days holiday during this period. This in turn results to strong demand for scrap during Oct-Nov’15 as buyers tend to take position in order to get timely delivery.

Scrap collection and supply slows down in winter, which can also a reason for increase in prices. US/Europe supplies 30% of scrap in seaborne market.

Indian buyers in dilemma

“Scrap prices suffer disparity”, said an importer based in Chennai. Higher scrap offers are still not accepted by Indian buyers as domestic prices corrected sharply in last 2 weeks. Prices may remain under pressure owing to festive season.

Indian scrap prices have witnessed a fall of around INR 600/MT D-o-D and INR 1,000-1,200/MT W-o-W.

Trade-wise

1. Shredded scrap offers from US/Europe to India were USD 200-205/MT CIF due to limited buying
2. Shredded scrap sold to Pakistan at USD 205/MT, CIF Pakistan
3. HMS 1&2 offers from Europe were USD 190/MT, CIF India
4. US/Europe HMS 80:20 prices to Turkey were in the range of USD 180-185/MT
5. Japanese Shredded Busheling offered at USD 218/MT, CIF India
6. Japanese Busheling Bundle offers were USD 220/MT, CIF India
7. Japanese Shredded scrap (premium) offered at USD 208/MT, CIF India.