- Stable steel rates limit scrap price gains
- 2 yards may soon receive provisional DASRs
Pakistan’s imported shredded scrap offers edged up by around $2/tonne (t) to $374-376/t CFR Qasim. The market remained steady, but trade activity lacked momentum. While the monsoon has set in, rains were still patchy — more notable in northern regions and Punjab. Additionally, delays in upgrading yards as Hong Kong Convention (HKC) standards led to subdued momentum in the ship-breaking market.
BigMint assessed European/UK-origin shredded scrap at $374/t CFR Qasim, marking a marginal w-o-w rise of $2/t.
Stable steel prices and cautious demand from mills limited steeper hikes in scrap tags. Meanwhile, local scrap prices remained firm amid weak mill sentiment.
Market commentary
Pakistan’s imported scrap market saw limited activity, with around 3,000 t of EU-origin shredded booked at $370-375/t CFR Port Qasim over the last three days. Additionally, 1,000-1,500 t of shredded were sold at $380/t, but that was yard-specific. A recent deal for 1,000 t was concluded at $375/t via a trader, with most offers hovering around the same level.
“The market remains quiet, with prices largely unchanged. EU shredded held at $373-375/t CFR, but there is hardly any active buying. UAE-origin shredded was offered at $382-386/t CFR Qasim, but again, not much movement. Locally, shredded was at PKR 136,000-138,000/t ($479-486/t), rebars were traded at PKR 236,000-240,000/t ($831-845/t), billets at PKR 200,000-202,000/t ($705-711/t), and Bala at PKR 194,000-195,000/t ($684-688/t). Mills waited for clarity before making fresh purchases,” observed a Karachi-based steel mill source.
“Locally, scrap was at PKR 138,000-142,000/t ($486-500/t), rebars at PKR 235,000-240,000/t ($828-844/t), and billets at PKR 195,000-200,000/t ($687-704/t). Sentiment was slow but could pick up. Overall, demand remains subdued amid cautious mill sentiment and stable local prices,” a local steel trader highlighted.
Gadani yards lag on HKC certification
While around 10 yards are upgrading to HKC standards, Gadani’s delayed action cost it market share in June. Last week, with most yards uncertified, Pakistan remained out of active bidding, allowing India to stay dominant.
Notably, the Balochistan Development Authority (BDA) is inspecting ship recycling facilities (SRFs) pursuing HKC certification. Two yards may soon receive a provisional Document of Authorisation Ship Recycling (DASR), with ClassNK and Bureau Veritas authorised to issue them. The federal government has allocated $40 million to enhance recycling infrastructure.
Provisional DASRs may allow limited vessel entries, but full HKC compliance remains critical.
Meanwhile, steel plate prices held firm at $616/t – the highest globally – even as the rupee weakened. However, rising pressure from sub-$300/t Chinese steel may challenge prices further. Vessel arrivals at Gadani were nil this week, compared to 10,386 LDT in the previous one.
Outlook
Scrap prices may stay range-bound as mills remain cautious amid stable local steel rates. A demand uptick is unlikely without stronger construction cues. Gadani’s ship recycling activity may stay slow despite provisional DASRs, as full HKC compliance remains pending, risking further strain on recyclers.
Leave a Reply