Only 9 Indian ports are allowed and 35 agencies registered to import scrap in India.
Indian import market continues to witness fall in scrap offers. The cleverly drafted, newly imposed pre-inspection shipment certification norms, from 1 July’15, are making importers a little nervous to resume their trades.
Even though the introduction of provision could not ease the worry of scrap participants. Importers are seen to be very apprehensive about the new rule of paying a guarantee of INR 10,00,000 during this dull phase of market where the demand for raw material is very weak and more than half of the requirement is fulfilled by sponge and Pig iron.
Sources informed that the market currently is so poor and inactive that till now only 30-35 inspection agencies have registered with DGFT for pre-shipment inspection across the globe. And around only 9 Indian ports have got scanners installed for now.
To import scrap in India, an importer either needs to follow the provision clause of passing the material through scanners or have to get it inspected through DGFT registered inspection agencies. But looking at the figures above, it seems scrap import will definitely shrink to a noticeable level, owing to lack in facilities.
Trade from US and Europe to India is expected to resume in two weeks time (owing to before hand setups at yards/ports). Current offers for scrap (shredded 211) from Europe are heard at USD 275-280/MT CFR India.
Whereas, no offers were heard from Middle East and African continent owing to absence of facilities as mentioned in the PSIC norms. According to market participants, resumption in trades from these countries seem to be doubtful in coming weeks.
As outlook, prices for ferrous scrap are expected to fall further across the globe. Low buying interest for scrap in Turkey owing to cheaper Chinese billets have pulled the scrap offers down by USD 10/MT this week. Offers there for HMS 80:20 are heard at around USD 258-260/MT CFR Turkey, whereas Chinese billet which are heavily traded are heard to be offered at USD 340-350/MT, CFR basis. Scrap market in other importing countries like Bangladesh and Pakistan also remain dull on the occasion of Ramadan.
Leave a Reply