The import scrap market in India has showed a sluggish trend and divergent outlook amid widespread talks of a number of “distress sales” at lower levels, even though none could be confirmed by buyers, SteelOrbis learned from trade and industry circles on Wednesday, July 5.
Most small mills have been staying away from concluding fresh bookings taking into account the demand depression for finished steel during the monsoon season. However, a section of traders said that scrap inventories at mills are low and some bookings could emerge before the monsoon rains gathers pace across the country later this month.
There are unconfirmed reports of deals at reduced prices, which have further compounded difficulties predicting the short-term trend, with some in the market expecting “official prices to slump”, while another section of the market has dismissed it as “speculators becoming active”.
Among the so-called distress deals heard in the market was a trade for ex-UK containerized shredded scrap at $412/mt CFR, while another ex-Europe shredded scrap contract has been heard at $415/mt CFR.
Last week, the reference price for imported scrap in India was at $415-422/mt CFR, declining to $412-415/mt CFR this week even though some market sources believe that a number of sellers do not want to go below $418-420/mt CFR.
“Customers are taking their time to make commitments. The market conditions are extremely confusing with so many unrealistic prices being heard. One unrealistic price can be dismissed as misinformation, but not so many that have been heard recently. The expectation of a slump is further extending inactivity, with buyers deferring deals,” a Mumbai-based trader said.
“Next week will be crucial as some more clarity can emerge with more definitive information on prices. Some positives outcomes are expected then and from expected restocking,” he said.