The global scrap market has turned silent amid the ongoing winter holidays. Pakistan’s scrap buyers also remained largely quiet due to an uncertain market trend and letter of credit (LC) issues. However, imported scrap prices remained on the higher side due to the material shortage.
Typically, the scrap generation remains slow during the winters holidays, and prices remain on the higher side. Offers for UK/Europe-origin shredded scrap in containers stand at $445-450/t CFR, up slightly w-o-w.
However, buying interest remains low and buyers expect that this hike is temporary.
Buyers are likely to resume trading once the bank allows to open new LC, SteelMint learnt from sources.
Pakistan imported 210,368 tonnes (t) in November as against 214,435 t in October, a slight fall by 2% m-o-m, as per customs data. The total volume imported by the country in the January-October 2022 period was 2.76 million tonnes (mnt), a fall of 25% compared to the corresponding period last year (CPLY).
Meanwhile, the country’s domestic scrap market has recovered as mills increased their finished, semi-finished, and scrap purchase prices.
Market highlights-
- Mills raise rebars offers by up to PKR 3,000/t ($13/t): Pakistan’s major steel mills, like Amreli Steels and Agha Steel, raised rebars offers by PKR 3,000/t ($13/t). Current offers for G-60 (10-12 mm) are at PKR 220,000-221,000/t exw-Punjab ($972-976/t), including taxes, effective from 23 October. However, tradeable prices are still lower by PKR 3,000-5,000/t. Other mills are likely to follow the suit. Rebars prices rose due to a severe disruption in the supply chain and a continuous rise in raw material prices.Offers for G60 rebars are at PKR 212,000-218,000/t exw-Punjab ($948-970/t), moving up significantly by PKR 20,000/t w-o-w.
- Local scrap prices continue to rise: Domestic scrap prices continued to edge up due to the material shortage and a continuous hike in prices. Fresh offers for local scrap are at PKR 145,000-150,000/t exy-Punjab (equivalent to shredded), moving up significantly by PKR 12,000-15,000/t w-o-w.
Pakistan domestic prices
- PKR maintains stability: The PKR remained unchanged for yet another week, closing at 226.3. As per the State Bank of Pakistan (SBP), the rupee slightly fell compared to last week.
- Suzuki announces plant shutdown in 2023: Suzuki has notified the Pakistan Stock Exchange that it will halt production from 2 -6 January 2023. This will be the sixth time that Suzuki will observe non-production days this fiscal year. However, this will be the first time that Suzuki will halt production for both its automotive and motorcycle plants. The company had previously halted production from 18–19 August, 22-26 August, 29–31 August, 19 -21 October, and 24 -26 October.
- Investment proposed for national grid expansion: Meanwhile, in a petition to the National Electric Power Regulatory Authority (Nepra), the transmission system operator stated that the proposed investment was required to meet the needs of an expanding transmission network with the induction of new power plants and technologies to various parts of the country, rehabilitation of the existing system, and the need for new technologies to contain losses. It will help steel mills to continue their production, which was halted due to limited power supply.
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