India’s scrap import trading saw a flurry of bookings late last week as buyers seized opportunities of lower-priced offers and the strong local currency, but buying tapered off thereafter as domestic secondary steel mills’ limited finances prevented sustained buying, SteelOrbis learned on Wednesday, October 14.
While buyers were seen to be taking advantage of the slight fall in shredded scrap prices, bulk higher volume trades were for HMS I/II ferrous scrap at a comparatively lower landed price.
Traders and market sources said that deals were concluded for ex-US shredded scrap at a price of around $305-310/mt CFR Nhava Seva port in the west, down by $3-5/mt from the previous level. They said that the slight fall in prices coupled with the Indian rupee appreciating beyond the INR 73 to the US dollar mark to INR 72.50 to the dollar in the middle of last week triggered the initial flurry of buying activity.
However, early this week lower ex-US offers were largely withdrawn amid expectations that rising finished steel prices in China would trigger a further uptrend in raw material prices and increased buying activity in bellwether markets like Turkey. The withdrawal of lower prices coupled with the volatile Indian rupee sliding against the dollar back to levels of INR 73.50/mt early this week prompted Indian buyers to step back.
Market sources said that a Mahrashtra-based secondary steel mill concluded a trade for ex-US containerized shredded scrap of 20,000 mt at $305-308/mt CFR Nhava Seva.
Another secondary mill in Raigarh in central India reported a trade for 20,000 mt of containerized shredded scrap at around $310/mt CFR, the sources added.
However, reflecting a shift in interest towards bulk HMS I/II, a Gujarat-based steel mill reported a trade for 30,000 mt of ex-US material at a price estimated by the market at $295-298/mt CFR Kandla port in the west. An eastern India-based secondary steel mill reported a deal for 15,000 mt for HMS I/II at a price of around $290/mt CFR Haldia port, the sources said.
“The flurry of activity seen during the week was an exception. Buyers were keen to seize the short-lived downturn in offers. But on the sellers’ side, low offers are not maintainable against the backdrop of rising Chinese finished steel prices. As for buyers, local secondary steel mills do not have the liquidity in face of the steady weakening in rebar prices to sustain raw material restocking,” a member of the Metal Recycling Association of India (MRAI) said.
However, even the short-lived revival in imports triggered a slight recovery in scrap prices in the local market. Prices were up INR 400/mt ($5/mt) to INR 25,700/mt ($350/mt) ex-stockyard at Mandi Govindgarh in the north. Prices edged up INR 200/mt ($2.50/mt) to INR 23,300/mt ($ 317/mt) ex-stockyard at Alang in the west.
$1 = INR 73.40