Indian scrap importers have cut down their purchases owing to weak Rupee; imports likely to come down in coming months.
Imported scrap offers to India remained stable this week as well, with not much activity in market. Sudden fall in major currencies (like Chinese Yuan, Russian Ruble) along with Indian Rupee has kept the market under caution. Market participants seem to be preparing for uncertainties and prefer to wait and watch the market flow, rather than placing orders.
Offers for imported scrap in India remained unchanged this week. European HMS 80:20 is heard to be offered at USD 230/MT, whereas Shredded at USD 245-250/MT CFR India.
Offers from Middle East for HMS 1&2 (23 tonnes loading) are at USD 225-230/MT, CFR and for HMS 1 (25 tonnes loading) are at USD 235-240/MT, CFR India. Whereas, HMS 1 from South Africa is offered at around USD 230-235/MT, CFR India.
Indian Scrap Imports may Fall in Coming Months
Indian scrap imports are expected to reduce in coming months. India is the third largest scrap importer in the world, importing around 5 MnT annually. Indian ferrous scrap imports were recorded at 506,000 MT in July and 481,000 MT in June.
Domestic scrap prices have moved up on anticipation that falling imports will increase domestic demand. Current offers for HMS 1&2 are at around INR 18,500/MT (Ex- Mumbai, Excise and Taxes Extra).
European Scrap offers may fall in Sept
European market participants anticipate fall in scrap offers during September on the back of increased scrap supply. Return of European scrap suppliers back in the market from long summer vacation may lead to increase in supply.
Moreover, depreciation in major currencies has increased the chance of price cut in export offers for billet. Currently, billet offers from Russia, China and CIS nations to the world’s largest scrap buyer, Turkey, are at USD 315-325/MT, CFR Turkey. Also, adding pressure to the scrap market, the bulk shipments for billet ordered by Turkey 1-2 months ago are about to arrive in next 10-15 days.
Depreciation in Turkish currency, Lira, may also resist buyers in the nation from fresh scrap imports.
USD 1 = INR 66.19 as on 22 Aug ’15
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