Imported scrap offers to Pakistan inched up slightly this week, after several weeks of sharp uptrend in prices, SteelMint learned from market participants. Buying activities have remained average with few deals of low quantity being concluded at increased prices, however severely low steel demand in the domestic market amid increasing raw material prices, has left steel mills under pressure.
SteelMint’s assessment for containerized Shredded 211 scrap from UK/Europe stands at USD 290/MT, CFR Qasim, up by USD 2-3/MT against last week’s report. Buyers’ bids were reported to be in the range of USD 285-288/MT, while quite a few smaller bookings of 500-800 MT were concluded in at USD 288-289/MT CFR in the last few days.
Few suppliers shared that no aggressive procurement is being witnessed currently, while with the global offers expected to mostly remain stable in the coming days, buyers interest could see an improvement, however, further increase in offers could force the buyers out of the market.
Trades for imported HMS has stood very weak in the recent weeks, while offers have continued to rise sharply on the upside at global levels. UAE origin HMS 1 (super) offers were reported to have climbed up to around USD 280-285/MT CFR, however, no buying for the same was witnessed this week.
UK and European origin HMS 1&2 (80:20) was offered at around USD 270/MT CFR amid negligible interest from buyers, with additional duty on HMS import also keeping the buyers off.
Local steel prices plunge- After a sharp rise in domestic prices observed last week on account of growing raw material import prices, the critically low steel demand in the market has forced the mills to cut the prices heavily after a week.
Amid little support from the local govt in improving the construction sector’s activities, given the lack of funds holding several infrastructural projects, the steel mills are offering sharp discounts to counter the low demand. Local scrap, Billet and rebar prices fell by 4000-4500/MT w-o-w, with some mills heard to intentionally offer additional discounts to increase their market share.
In the northern region, rebar’s average offer prices were reported at around PKR 105,000-106,000/MT, ex-works (USD 673-679), while southern (Karachi region) steel mills are offering at PKR 106-107,000/MT (USD 679-685) ex-works, sharply down by PKR 4000/MT on a weekly basis.
| Particular (Average Offer Prices) | 12-Nov’19 | Last Assessment on 05-Nov’19 | Change W-o-W |
| PKR/MT | PKR/MT | PKR | |
| Local Scrap (Equivalent to Shredded) | 61,500 | 65,000 | -3500 |
| Bala (Local Billet) | 84,000 | 88,000 | -4000 |
| CC Billet (Grade 40) | 89,000 | 93,000 | -4000 |
| CC Billet (Grade 60) | 90,000 | 94,000 | -4000 |
| Deformed bar (G-60), Ex-Punjab/KPK | 105,000-116,000 | 109,000-110,000 | -4000 |
| Deformed bar (G-60), Ex-Sindh (Karachi) | 106,000-107,000 | 110,000-111,000 | -4000 |
Source: SteelMint Research
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