India's SAIL Concludes 55,000 MT Imported Scrap Purchase Tender - Sources

Salem Steel Plant (SSP), a unit of Steel Authority of India Limited (SAIL) - a government of India undertaking had floated a global tender for purchase of around 55,000 MT imported melting Shredded scrap on 21st Dec’18.

As per tender document, the bidders were asked to quote price separately on per MT of scrap with tentative plant wise quantity as 40,000 MT for Salem plant (SSP) on CFR Chennai Port and 10,000 MT for Kolkata plant (ASP) on CFR Haldia/ICD Durgapur Port basis with packaging in 20ft end opening containers.

The price evaluation was to be done on the basis of Landed Cost Net of Set off (LCNS), per MT of scrap. For imports, to arrive at LCNS, in addition to all Customs Duties, C&F and Inland freight charges of Rs.2010 per MT will also be considered. The evaluation has been done in the two-stage mechanism - techno-commercial to assess suppliers capability and Reverse Auction. It is the second price discovery for which the date of tender opening was 30th Apr’19.

According to market sources report to SteelMint, SAIL has concluded the entire tender quantity of 55,000 MT. If sources to be believed, the tender concluded for Shredded at USD 340/MT, CFR Chennai and USD 350/MT, CFR Haldia port.

Indian imported scrap market scenario -

Following recent price correction by USD 8-10/MT in Turkey, Indian imported scrap prices have slightly inched down after sharp recovery last week. The market observed few trades amid improvement in demand post election’s outcome but major buying interest remains subdued amid issues of labor shortage on extreme summer conditions in most of the regions and still slow support from end users in the country.

SteelMint’s current assessment for containerized Shredded from Europe and UK stand in the range USD 330-333/MT, CFR Nhava Sheva, slightly down by USD 2-3/MT against last week’s report. Few leading suppliers were offering Shredded at around USD 335/MT, CFR Nhava Sheva and USD 340/MT, CFR Vizag as they were not ready to lower offers further resulting in limited trades.

South African HMS 1&2 offers stand in the range of USD 330-335/MT, CFR. Few offers of Dubai origin HMS 1&2 scrap were heard in the range of USD 325-327/MT as per quality amid limited supply on ongoing Ramadan month. Few trades for West African origin containerized HMS were reported in the range of USD 310-315/MT, CFR India

It is being expected that sentiments in the domestic market likely to turn supportive for scrap importers to book imported scrap actively in Mid-June once all subcontinental markets resume buying after Eid-holidays amid limited inventories in hand soon after which monsoon season to slow down both production and end demand again towards Mid-July.