South Asian Scrap Importers Turn Silent; Seek Clarity on Global Offers

According to market prediction, prices are expected to have bottomed out and likely to rise in coming days with the upcoming election results in India and on increasing positivity among Turkey steel mills amid removal of 25% tariff on Turkish steel from the US government.

Pakistan turns silent as Rupee hits a record low - Pakistan’s currency Rupee has reached a new all-time low against the dollar after the government last week reached a preliminary agreement with the IMF for $6 billion bailout. The rupee has dropped to 147-148 levels, depreciating by another 4-5% against 141 to the dollar earlier this week.

As a result, the market turns very silent and everyone is in ‘Wait and Watch’ mode as there has not been much trade movement in the market. The dollar has already become 25% more expensive since December 2017 and there is still a possibility of its rate to increase by another 5% to 10% under the IMF program.

“Steel mills and manufactures may temporarily hold the sales of billet and finish steel to see the impact of currency depreciation, activity is expected to remain so low and scrap importers have turned cautious. Local steel prices are expected to rise in the near terms” shared a trade source.

SteelMint’s assessment for containerized Shredded scrap stands at USD 323-325/MT, CFR Qasim.

Indian imported scrap trades remain limited - Indian sentiments turn positive in terms of prices following price hike in the global market, however, scrap importers observed very limited trades in containers due to ongoing elections which is at its peak and outcome to be revealed on 23rd May’19.

SteelMint’s assessment for containerized Shredded from Europe, UK and US stand at USD 320-325/MT, CFR Nhava Sheva, down USD 5-10/MT against last week. Steel mills reported to have booked few trades for Shredded earlier this week at USD 318-320/MT, CFR on immediate payment terms and USD 323-325/MT, CFR for normal payment terms, however, offers from leading scrap yards remain in the range of USD 325-330/MT, CFR.

European origin HMS offers heard in the range of USD 305-315/MT, CFR depending on quality. Offers from Dubai based scrap suppliers remained limited amid Ramadan holidays with HMS 1&2 trades reported at USD 323-325/MT, CFR Nhava Sheva and HMS 1 at USD 328-330/MT, CFR. South African HMS 1&2 remained stable in the range of USD 330/MT, CFR.

West African HMS 1&2 in 20-21 MT containers traded in the range of USD 305-310/MT, CFR India.

Indian domestic scrap prices range bound - Price assessment of local HMS 1&2 (80:20) has marginally lowered by INR 300/MT on weekly basis to INR 23,200-23,500/MT (USD 330-335), CFR Chennai while remained stable at INR 24,800-25,000/MT (USD 353-356), ex- Mumbai as sales of finish steel still remain low. Indian currency slightly depreciated against this week against USD as the current USD/INR exchange rate stands at 70.2 levels today against 69.9 levels a week back.