US scrap export prices to India decline

Tuesday, 31 January 2017 00:13:36 (GMT+3)   |   San Diego
       

Early in January, ex-US containerized shredded scrap offers to India were heard at $290-295/mt CFR Nhava Sheva but Indian traders considered the price too high and were placing bids at $20-30/mt lower. At the time, US exporters were not flexible as they expected Turkish mill buys for February shipment to reflect favorable prices.  Additionally, export offer prices remained firm given the US domestic scrap market’s third consecutive monthly increase in January.
 
However, in the last several weeks in January, especially with the most recent purchases, Turkish mills pulled scrap prices down sharply. The most recent ex-US bulk deal was concluded at $240/mt CFR for HMS I/II 80:20 scrap and $245/mt CFR for shredded scrap.
According to sources close to the market, a recent ex-UK deal took prices down further to $220/mt CFR for HMS I/II 80:20 scrap and $235/mt CFR for bonus grade. However, several sources said  the transaction was an anomaly and that both continents will probably resume future Turkish scrap deals at export prices closer to the most recent ex-US deal mentioned above.
 
As a result of the recent drop in ex-US scrap prices, offer prices for containerized shredded to India also decreased to $245-260/mt CFR Nhava Sheva.
 
Within the last two weeks, Indian traders have been heard purchasing HMS I/II 80:20 scrap from South Africa at $255-260/mt CFR Nhava Sheva. Therefore, US exporters hope that the new pricing proves more competitive and results in shredded deals to India. India has not been heard purchasing much US scrap since fall 2016.
 
Still, a source noted that “prices on flats in India may not be sustainable despite announcements for stable pricing from mills in February. We are hearing India is also grappling with low finished steel demand, which will affect their scrap purchases.”                                     


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