Import scrap prices in India have edged up over the past week, breaking a prolonged stagnation, with sellers submitting higher offers, expecting finished steel prices to be lifted by rising input costs of iron ore and coal and impacting overall trade in scrap, SteelOrbis learned from trade and industry circles on Wednesday, July 30.
Sources said that ex-UK/Europe containerized shredded scrap offer prices have risen to the range of $370-375/mt CFR Nhava Sheva port in the west, up from $360-365/mt CFR a week earlier, while HMS I/II (80:20) scrap is available at $340-345/mt CFR, compared to $335-340/mt CFR a week earlier.
Even though no deals were reported at the higher levels, sellers have been positioning offers expecting improved trade conditions in August.
Rising local price of fines and coal will contribute to better finished steel prices. At the same time, the downtrend seen in recent months in prices of local scrap and sponge iron in India is also seen to be have run its course and bottomed out and any rise will reduce secondary mills’ preference for local supplies.
Better finished steel prices and higher prices of local raw material alternatives are expected to prompt induction furnace operators to take a “keener look at import options”, the sources said.
It was pointed out that the downtrend in prices of local scrap and sponge iron has reversed during the past week with reports indicating that the markets for both raw materials may have bottomed out and that the local scrap market may be entering tighter supply conditions. Local bulk scrap prices have gained INR 500/mt ($6/mt) to INR 32,400/mt ($372/mt) ex-Mandi Govindgarh and all discounts have been pulled back. Local sponge iron prices are up INR 1,000/mt ($12/mt) to INR 30,000/mt ($344/mt) ex-Mandi Govindgarh.
“Overall increases in inputs costs are lifting sentiments and the outlook on imported scrap too. August could see a revival in trade activity. Global scrap sellers are therefore positioning themselves for next month through upward adjustments to offers,” a Mumbai-based scrap trader said.