Several containers of steel scrap bound for Pakistan are understood to have been lost following the sinking of the Singapore-flagged GFS Pride in the Strait of Hormuz, SteelOrbis learned from market sources on Thursday, October 15.
The 2,824 TEU container vessel sank on October 13 after sustaining damage and catching fire while transiting the strait. According to the Maritime and Port Authority of Singapore (MPA), the vessel was reportedly struck by an unknown projectile. All 21 crew members were safely evacuated and no injuries were reported. Operated by Dubai-based Global Feeder Shipping (GFS), the vessel was deployed on a Gulf-Pakistan route and was scheduled to call at Pakistan's Port Qasim after stops at Fujairah, Jebel Ali and Al Jubail.
While no complete cargo manifest has been made public, a scrap market source told SteelOrbis that steel scrap bound for Pakistan was among the cargo on board. According to the information provided, at least 221 containers of steel scrap destined for Pakistan were being carried by the vessel.
The circumstances surrounding the sinking remain disputed. Iranian authorities said the vessel struck a naval mine while sailing along what they described as an unauthorized and dangerous route, while Singapore's maritime authority reported that the ship had been hit by an unidentified projectile.
Following the sinking, containers were reported floating in the Strait of Hormuz, prompting navigational warnings for vessels operating in the area. The International Maritime Organization has also listed the GFS Pride as sunk, with no pollution reported.
The incident is of particular relevance to Pakistan's steel market, given the country's strong reliance on imported ferrous scrap, much of which is shipped in containers.
Market participants are now watching for possible repercussions on containerized scrap flows to Pakistan, including higher freight and marine insurance costs as well as potential delays to deliveries. Market sources noted that the incident could further increase the perceived risks associated with scrap shipments from the Gulf region, particularly if shipping companies and insurers reassess conditions for vessels transiting the Strait of Hormuz. Additional freight or insurance surcharges could increase replacement costs for Pakistani buyers and further extend delivery times.
The incident could also have implications for the UAE scrap market. Pakistan is a key outlet for ferrous scrap generated in the Gulf, and any prolonged disruption to export flows could leave greater volumes available in the UAE domestic market. Given that local scrap generation exceeds domestic consumption requirements, greater difficulties in exporting material could put additional downward pressure on UAE scrap prices.
At the same time, Pakistani buyers could face the opposite pressure, with higher transportation and insurance costs potentially supporting CFR scrap prices. Market participants therefore see a risk of increasingly divergent market conditions, with weaker domestic scrap prices in the UAE and higher procurement costs for buyers in Pakistan if logistical disruptions persist.
However, it is still too early to assess the broader impact on Pakistan's import scrap market. The market is expected to closely monitor any changes in freight rates, insurance premiums, shipping surcharges and vessel routing in the coming days.
