India’s scrap import trade has remained limited during the past week by the slight rise in prices and secondary steel mills being busy in clearing previous cargoes and short on liquidity to conclude fresh contracts, SteelOrbis learned on Wednesday, May 13.
According to trade circles, secondary steel mills faced with a shortage of working capital from banks have been waiting to see if banks will extend concessional funds to the sector under the $266 billion government economic package announced on Tuesday to revive the pandemic-hit economy.
Import trade has been severely hit as most secondary steel mills have already cash locked up in scrap container cargoes stuck at ports and do not have additional funds to make fresh bookings, and importers are hoping for a flow of funds from banks to trigger fresh trading, sources said.
Ex-UAE shredded scrap prices are in the range of $255-260/mt CFR Nhava Seva Port in western India, up $10/mt compared to last week. The sources said that ex-US scrap quotations have continued to be unavailable. European shredded scrap has been offered at $260-265/mt CFR and above, up at least $5/mt compared to a week ago.
The sources said that a Gujarat-based secondary steel mill has concluded an import contract for ex-UAE 20,000 mt HMS I/II 80:20 at $257/mt CFR Kandla port in the west. A Maharashtra-based secondary steel mill has reported a contract for 22,000 mt shredded scrap at the slightly lower price of $255/mt Nhava Seva, with sources pointing out that the same steel mill already had several containers delivered early this month stuck at the Inland Container Depot (ICD), as the region is among the worst impacted by the pandemic, leading to huge congestion in logistics.
“Several importers have complained that demurrage and ground rental at ICDs for their stuck consignments have exceeded the total value of imports. There is an acute labor shortage to evacuate consignments from ports and transport them to plant sites. No secondary mill has liquidity to cope with such expenses,” a member of the Metal Recycling Association of India (MRAI) said.
The lack of appetite for the raw material restocking among local secondary steel mills has been reflected in local scrap prices, which have edged lower during the past week.
Scrap prices are down INR 600/mt ($8/mt) to INR 21,880 ($289/mt) ex-stockyard at Mandi Govindgarh in northern India. Prices have lost INR 400/mt ($5/mt) to INR 20,400/mt ($269/mt) ex-stockyard at Alang in the west.
$1 = INR 75.70