On July 10, SteelOrbis reported that scrap import offers into Pakistan were seeking direction as buyers largely remained on the sidelines at $375-385/mt CFR Pakistan on containerized shredded scrap offers.
Sources inform SteelOrbis that as the global scrap market seeks to maintain equilibrium in offers incorporating scrap supply tightness and Turkey’s lower import purchase prices, Pakistan buyers also must contend with currency devaluation in their import decisions.
A source commented on the fact that in early December the exchange rate against the dollar was approximately PKR 105.25. By December 22, the rate had increased to PKR 110.45, by March 29 it had increased to PKR 115.51, and by June 22 it increased to PKR 121.68. On July 17, the exchange rate continues at PKR 121.64. A source noted an example that if in December a shredded containerized cargo deal could be achieved at $360/mt CFR, that translated to PKR 37,890/mt, which now is PKR 43,790/mt, an increase of 16 percent in PKR terms. He added, “The currency pressure, softness in regional market on seasonality, and softness in global scrap market will likely trend scrap import deals down, already $360/mt CFR is likely feasible in regards import.” A second source added that lower import offer prices on finished goods in the region from China and other countries are also limiting the purchase price outlook on scrap buys in the country.