Pakistan’s imported scrap prices have moved down over the past week, compared to the firmer levels heard last week, while market sentiment has turned more cautious and trading activity has weakened. Buyers have largely remained on the sidelines amid the sharp fall in finished steel prices and continued uncertainty regarding the possible impact of the US-Iran situation on Middle East supply. Overall, the market looks fragile and is seen as more exposed than some other markets to a correction if freight costs and war-risk premiums ease.
More specifically, ex-UK/EU shredded scrap have been offered at $425/mt CFR Qasim for May shipment this week, compared to $428-435/mt CFR heard last week, however, some April-shipment offers have still been heard at $435/mt CFR Qasim. At the same time, bookings for material of the same origin have been heard at $420-425/mt CFR, compared to around $425/mt CFR for deals heard last week, with current bids reported at $420/mt CFR. Overall, the workable price range for ex-UK/EU shredded scrap has moved down by around $5-10/mt week on week, though activity has remained limited as buyers have continued to wait for more clarity in the market. As for ex-UK/EU HMS I/II 80:20, offers have been heard at $385-390/mt CFR this week, in line with the softer tone in the imported scrap market.
“Customers are in a wait-and-watch mood and are waiting for a final decision regarding the US-Iran war and its impact on Middle East supply,” a source in the market told SteelOrbis.
On the UAE side, no fresh firm offers have been heard in the market this week. However, market participants have indicated that customers expect Dubai supply to be reinstated soon, which has added to the softer tone in Pakistan’s import scrap market.
Meanwhile, in the Pakistani domestic market, sentiment has turned sharply weaker, with downstream consumers staying cautious after the steep fall in finished steel prices. According to market sources, some mills have reduced rebar prices, while traders and retailers have come under pressure due to the rapid decline in the market. According to sources, grade 60 rebar prices have been heard at around PKR 235,000-245,000/mt ($843-879/mt) ex-works, compared to PKR 262,600-265,400/mt ($940-950/mt) ex-works in Karachi heard last week. At the same time, local scrap prices equivalent to shredded have been reported at around PKR 147,797-157,557/mt ($530-565/mt) ex-warehouse, down from PKR 150,000-160,000/mt ($537-573/mt) ex-warehouse heard last week. Market sources have indicated that activity has declined further, as downstream buyers have become more hesitant after the sharp correction in finished steel prices and high-priced cargoes held by stockists are still being liquidated.
“The sharp fall in prices has put serious pressure on traders and retailers. Many are facing heavy losses on high-priced inventories, while retail sales have dried up as buyers wait for clearer direction amid geopolitical uncertainty and local economic instability,” a local market source told SteelOrbis.
All prices on Pakistani rupee basis include 18 percent VAT.
$1 = PKR 278.86
