Pakistan: Domestic scrap prices up, imported scrap trades remain subdued

Domestic scrap prices in Pakistan have continued to witness northward movement this week on tighter availability. SteelMint’s assessment for local scrap now stands at PKR 91,170/t exy Punjab, up by PKR 170/t w-o-w.

Also, Pakistan’s Gadani ship-breaking yard in Balochistan has decided to suspend operations from 6th to 18th May’21 to supply oxygen gas for medical use. Keeping in view the increasing demand for oxygen in the health sector, Gadani yard will divert 30 tonnes of oxygen per day to healthcare, the National Command and Operation Centre (NCOC) notified. This is expected to further tighten the availability of ship-breaking scrap in the country.

Imported scrap prices have continued to rally as few market participants were actively restocking inventory before Eid holidays. Few trades have been reported at increased offers however, market is not very active and people are booking as per their requirements.

“Business activity is slow due to increased Covid cases and govt has announced long Eid holidays from 8-15 May so it will keep business activities subdued” shared a prominent scrap buyer.

Recent trades and offers:

• Few trades for around 3,000 t of UK/EU origin shredded in containers have been concluded at $475-480/t CFR levels.
• SteelMint’s assessment for UK/EU origin shredded stands at $478/t CFR Qasim levels, up by $8 against the end of last week.
• Offers for Dubai origin HMS1 are now available at $465-470/t CFR Qasim levels, registering a hike of $5-10/t against last assessment.

Domestic steel market quiet on upcoming Eid holidays: Pakistan’s rebar trades have slowed down amid holiday mood. According to SteelMint, G-60 rebar price in Punjab region stand at PKR 131,280/t exw Punjab, offers are heard at PKR 129,000-132,000/t exw Punjab levels.

Rebar prices should increase to around PKR 5,000-6,000, then only it will touch the break-even point, SteelMint learnt.

Outlook: Market participants consider that the market will see trade activities towards closing the week or before the Eid holidays. Rebar offers are expected to increase after the holidays on increased raw material cost.