Import scrap prices in India have softened amid muted demand on the back of weak rebar prices and the local currency continuing to seek new historical lows, increasing the costs of import trade, SteelOrbis learned from trade and industry circles on Wednesday, October 18.
Ex-Europe containerized scrap offer prices are reported at $405-410/mt CFR Nhava Sheva port in the west, down from $415-420/mt CFR early last week and $410-415/mt CFR as tradable on Friday, but buyers’ bids have fallen to $395-400/mt CFR, resulting in sparse trade during the past week.
Among the stray deals was one for UK origin 2,000 mt of containerized shredded scrap at $402/mt CFR.
The tradable ex-UK HMS (80:20) scrap price was reported at $390/mt CFR Nhava Sheva, down by $5/mt from the previous deal for this grade early in the week and from $398-400/mt CFR in bids last week, but no deal was confirmed at the new level, the sources said.
“The local currency has breached the historical low three times in the past week and is currently pegged at INR 83.35 to the US dollar. This not only increased the landed cost of imports but has increased currency risk hedging costs too. Small and medium-scale distributors are not usually able to absorb such currency volatility,” a Mumbai-based distributor said.
“More importantly, there is an overall demand depression for scrap as raw material. There is a lot of rebar supply and inventories at secondary mills. We hear that induction furnace operators are cutting output rates by as much as 50 percent to bring about a supply-demand balance. Hence, we do not see any appetite for high-cost imported raw material,” he said.