Indian imported scrap price has posted slight declines compared to last week, but upbeat trade activity seen recently has been dampened by fresh pressures emerging in the local rebar market and scrap prices have been expected to lose momentum, SteelOrbis learned from trade and industry circles on Wednesday, May 24.
A trade for 1,000 mt of ex-Europe containerized shredded scrap was reported at $440/mt CFR Nhava Sheva, marginally lower than similar trades concluded at $443-445/mt CFR a week ago.
A contract for 5,000 mt of West African origin HMS (80:20) scrap was reported by a Mumbai-based trading firm at $425/mt CFR Kandla port, also marginally down from $428/mt CFR a week ago. An offer for ex-Europe HMS scrap was at $430/mt CFR, but no confirmed deal was reported by any buyer or market intermediaries, sources said.
“Buying activity fell over the week. Import prices are relatively stable at higher level, while the Indian currency hit a 13-week low against the US dollar, making import deals expensive at a time when rebar local price moved onto a downtrend. Mills are not in mood to restock raw materials in a hurry,” a Mumbai based ferrous and non-ferrous trader said.
“Global dynamics indicate expectations of scrap prices to strengthen further. But at the same time, fundamentals of finished steel prices do not support very high raw material prices. Buyers are waiting for some clarity on these two divergent trends before committing trades,” he said.
Another trader pointed out that the business risks in the sub-continent has increased for sellers and hence no discounted deals are being put on the table. Bangladesh is facing shortage of foreign currency to meet basic imports of fuel while Indian currency is rapidly depreciating against the US dollar and cost of import funding from banks rising.