Import scrap prices in India have surged during the past week, pushing buyers completely out of the market with the price gap between sellers and buyers widening and making deals completely unviable, SteelOrbis learned from trade and industry circles on Wednesday, July 14.
Containerized shredded scrap prices have risen to $520-530/mt CFR Nhava Sheva port in the west, compared to the peak of $510-520/mt CFR in previous weeks.
The sources said that the gains in prices have pushed buyers out of the market as the latter are still seeking deals below the $500/mt CFR mark, leading to only one nominal volume trade heard in the market.
“Indian secondary mills are not in a position to accept higher prices either because rebar prices are weakening or they have sufficient raw materials to feed plants at lower capacity utilizations levels,” an official at a Gujarat-based secondary steel mill cum scrap trader said.
According to a Mumbai-based trader, the halt in buying can only be temporary as imported scrap continues to be a seller’s market and, even in the event of a correction, prices are unlikely to bottom below the $500/mt mark and it is only a matter of time before secondary mills will be need to resume buying.
The trader pointed out that sellers have a lot of options in the region with reports indicating that they are securing higher realizations in markets like Pakistan at around $535-545/mt CFR even with India out of the market, are under no pressure to accept Indian bids below the $500/mt mark.
Sources said that a nominal trade of around 2,000-5,000 mt was heard in the market from a western India-based secondary steel mill at a price of around $520/mt CFR.