SteelMint learned in recent conversation with market participants that Pakistan observed few imported scrap deals concluded at pressurized prices. However, local steel market remained very quiet and end customer prices have been stated in line with the last weeks’ report. Shredded scrap prices have come under immense pressure amid softening global scrap prices on bearish outlook.
In recent deals, Containerized Shredded 211 from Europe and UK sold in the range of USD 345-350/MT, CFR Qasim, down by USD 8-10/MT W-o-W. Few leading recyclers were quoting Shredded in the range of USD 355-357/MT, CFR but buying interest stands in the range USD 340-345/MT, CFR. Around 6,000 MT containerized Shredded sold at USD 355/MT,CFR last week.
Offers for Dubai origin HMS 1 heard at around USD 337-340/MT, CFR Qasim, stable on W-o-W basis. However, now buyers are holding back on depressed local market.
Market awaits positive response from the Government – Local steel associations in Pakistan are trying to follow government officials but no positive response has shown yet. The government reportedly negotiating financial assistance from the IMF, over which some participants anticipate that further currency devaluations could occur before the year end. After receiving recent financial aid from Saudi Arabia, market awaits for positive response from the government.
Apart from a ban on sky high construction, smuggling of cheaper Iranian rebar had hit re-rollers operation in the country. Few steel mills observed closure over non-availability of bricks as brick manufacturing factories have been witnessing closure over heavy smog in some major steel producing regions in the country.
Local steel price assessment as on 20th Nov’18 –
| Average Prices, Ex-work Punjab and Lahore, inclusive of taxes | ||||
| Particular | 20-Nov’18 | Last assessment on 13-Nov’18 | W-o-W Change | |
| PKR/MT | USD/MT | PKR/MT | PKR | |
| Local Scrap (Equivalent to Shredded) | 57,500 | 428 | 57,500 | 0 |
| Bala (Local Billet) | 76,000 | 565 | 76,000 | 0 |
| CC Billet (Grade 40) | 82,000 | 610 | 82,000 | 0 |
| CC Billet (Grade 60) | 83,500 | 621 | 83,500 | 0 |
| Deformed bar (G-60) | 100,000-101,000 | 744-751 | 100,000-101,000 | 0 |
Source: SteelMint Research, USD/PKR = 133.02
Imports of cheap Chinese & Iranian steel products and liquidity crunch have shattered local sentiments leading to shut down of many domestic rolling mills in protest.
“This seems worst situation since almost past decade as no movement at all in the local market and the customers are scared of giving credits at present“, shared a source.
Rebar prices remain hovering in the range – In Punjab region, deformed rebar assessed in the range PKR 100,000-101,000/MT, ex-works. While in Sindh region price come down at PKR 102,000-103,000/MT, ex-works after slight upward correction in the mid of last week. Deformed premium G-60 rebar prices remained unchanged in the range PKR 104,000-106,000/MT, ex-Karachi inclusive of taxes.
Ship breaking market seems to remain long way off – According to reports, Gadani based buyers remained sidelines on shocking decline in the local market witnessing very few offers locally. Many had been hoping for a fourth quarter resurgence but that seems some ways off at present with stoppage on recycling activities. Local ship plate prices assessed at PKR 76,000/MT stable as against the last report. While Ship breaking prices moved down USD 10/MT W-o-W at USD 420/LT for dry bulk cargo, at USD 440/LT for containers and USD 430/LT for tankers.
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