Import scrap offers to India have fallen over the past week, but have still failed to trigger the trading of any significant volumes as secondary mills have lacked confidence after rebar prices entered a fresh downtrend, and also as the demand forecast for the post-monsoon season has become more cautious than earlier, SteelOrbis learned from trade and industry circles on Wednesday, August 27.
Offers for ex-UK/Europe containerized shredded scrap are reported at $360-365/mt CFR Nhava Sheva port in the west, down from levels of $370-375/mt CFR a week ago. The price level for ex-UK HMS I/II (80:20) was reported at $330-335/mt CFR, compared to $330-340/mt CFR a week ago.
According to the sources, the only trade of the past week was confirmed by a western India-based large induction furnace operator for a 5,000 mt mixed cargo of UK origin at an average price of $355/mt CFR Kandla port in the west.
Most bids for shredded have been heard at not above $355/mt CFR, so the SteelOrbis reference price for imported shredded in India has slipped by $5/mt over the week to $355-365/mt CFR.
The sources said that secondary mills have preferred to source raw materials locally after the sharp fall in scrap prices in the local market, since not only are imports unviable in view of falling finished steel prices, but also the local currency touching frequent historical lows has made the landed price of imports prohibitive.
It was pointed out that local bulk scrap prices have slumped INR 900/mt ($10/mt) to INR 31,400/mt ($358/mt) ex-Mandi Govindgarh in the north, making it a preferred raw material choice to meet limited demand.
“Trade activity for imports is very limited as most furnace operators are preferring local sourcing. It is a very price-sensitive market now since, despite all expectations, rebar prices have entered a new down-cycle. The demand forecast in the rebar segment is also much more conservative that earlier, prompting caution among secondary mills which were planning increasing outputs in the post-monsoon season from the end of September onwards,” a Mumbai-based distributor said.