India’s import scrap prices have continued to increase during the past week resulting from tight supplies, but trading activity has nosedived and only a couple of deals have been reported in the market with secondary steel mills abruptly halting any new contracts, SteelOrbis has learned on Wednesday, July 22.
According to traders, not more than two deals for small volumes have been reported in the market as electric arc furnace-based steel mills were put off by steadily climbing offer prices at a time when several local authorities have re-imposed fresh lockdowns in key industrial regions and steel mills have been facing the possibility of once again reducing their plant operations, at least in the short term.
The sources said that a Gujarat-based steel mill-cum-trading firm has concluded a modest volume contract for 15,000 mt of shredded scrap at the higher end of the price range of $280-282/mt CFR Kandla port for September delivery, with sources adding that this was reported for onward trading rather than its own consumption. Last week, the price level for imported shredded scrap was at $272-280/mt CFR. Offers from European suppliers for shredded scrap are coming at around $285/mt CFR at the moment.
A Maharashtra-based electric arc furnace steel mill concluded a deal for a relatively small tonnage of bulk HMS I/II 80:20 totaling 12,000 mt at a price range estimated by the market at $272-274/mt CFR Nhava Seva.
“Major industrial regions like Maharashtra, Tamil Nadu and West Bengal are all entering new lockdown periods. This will ensure new uncertainties in production planning, logistics of raw material supplies and manpower availability for steel mills. Under the circumstances, it is not prudent for scrap-based steel mills to restock raw materials, particularly on a rising price curve,” a member of the Metal Recycling Association of India (MRAI) said.
The lack of interest in restocking raw materials has had its impact on the local scrap market which has witnessed a reversal of the upturn in prices during the past week. Scrap prices are down INR 300/mt ($4/mt) to INR 21,800/mt ($292/mt) ex-stockyard at Mandi Govindgarh in the north. Prices have weakened by INR 200/mt ($3/mt) to INR 20,800/mt ($278/mt) ex-stockyard at Alang in the west.
$1 = INR 74.70