Import scrap prices in India have continued to be on the low side in the past week, with secondary mills averse to risking trades following the further depreciation of the local currency increasing import risks, SteelOrbis learned from trade and industry circles on Wednesday, November 26.
Sources said that ex-UK/Europe containerized shredded scrap offers are reported in the range of $350-353/mt CFR Nhava Sheva port in the west compared to $350-355/mt CFR a week ago, with a few bids heard at lows of $345/mt CFR, resulting in no trades being confirmed over the past week.
Ex-UK HMS I/II (80:20) are reported at $310-315/mt CFR, unchanged over the past week, but no trades have been confirmed as induction furnace operators have continued to meet limited demand from local sources.
It was pointed out that the Indian rupee continued to breach previous lows several times over the past week and currently stands at another historical low of INR 89.20 to the US dollar. Currency dealers are seeing the next target of the rupee at INR 90.00 to the dollar as the central bank of the country is heard to have stopped intervening to support the depreciating local currency.
This has significantly increased the landed price of imports apart from the higher risks involved in hedging currencies. At a time when finished steel prices have been softening and furnace operators have been reducing plant output levels to balance market oversupply, higher import risks have not been acceptable to buyers, sources said.
Despite local bulk scrap prices hardening, it is still a preferred source as buyers can avoid currency risks and, since raw material requirements are on the lower side, they can book smaller lots compared to import volumes.
Bulk scrap prices are up INR 400/mt ($4/mt) to INR 31,900/mt ($358/mt) ex-Mandi Govindgarh in the north, while sponge iron prices are down INR 350/mt (4/mt) to INR 26,800/mt ($301/mt) ex-Raipur in the central region.