Imported scrap prices in India have been relatively stable, but bids have continued to fall. The market has seen a further slowdown in trade activity with buyers becoming extremely “nervous” after local rebar trade prices hit a two-year low and with secondary mills not being in the mood or in financial positions to commit import trades, SteelOrbis learned from trade and industry circles on Wednesday, July 26.
Ex-Europe shredded scrap prices have remained relatively stable at $405-410/mt CFR. Sources said that, among the stray deals confirmed, was a 1,000 mt tonnage of ex-UK shredded scrap booked at $407/mt CFR Nhava Sheva port. But most buyers have been bidding at below $400/mt CFR this week.
“Buyers are only willing to conclude deals if deep discounts are available. Bids are heard as low as $380-390/mt CFR for containerized shredded scrap but no sellers were interested, leading to trades falling through. The prolonged downtrend in finished steel prices has unnerved buyers. Secondary mills facing a sharp erosion in margins are not in a position to bear additional risks including the currency risks involved in imports,” a Mumbai-based scrap trader said.
“At the same time, local sponge iron prices are down to a new low and hence the interest in imported scrap as feedstock is also low. With the monsoon season expected to be be extended, demand for raw material from secondary mills will remain depressed,” he said.
However, an official at an eastern India-based electric arc furnace secondary mill said that indications are of a price correction setting in overseas and this may prompt sellers to offer higher discounts, which may revive interest among buyers in the coming weeks.