Import shredded scrap prices in Indian have showed high volatility with prices going up early in the week, but the gains were subsequently wiped out due to buyers’ resistance and the rejection of offers amid the drastic weakening of the local rebar market, SteelOrbis learned from trade and industry circles on Wednesday, April 27.
The containerized shredded scrap prices in India first rose $650-655/mt CFR Nhava Sheva port in the west, but slumped to $610-630/mt CFR towards the close of the past week, compared to the average tradable level of $634/mt CFR a week ago.
“Secondary mills are wary of such high prices, particularly with the local rebar market in freefall and high input costs cannot be passed on to finished steel buyers. Hence, a large number of offers have been rejected,” an official at a Gujarat-based scrap trader cum mill operator said.
“Also, ex-US scrap prices are expected to settle lower in May as supply chain disruptions are ruled out and the demand-supply mismatch is not as big as feared soon after the Russian invasion of Ukraine. That too is prompting local mills to defer any booking commitments right now,” he said.
According to an eastern India-based secondary mill operator, there has been a shift in feedstock from high-priced imported shredded scrap to sponge iron following sharp reductions in prices. Sponge iron prices in the eastern regional market around Durgapur have dropped INR 3,500/mt ($46/mt) to INR 37,300/mt ($487/mt) ex-warehouse.
Trade circles said that imported scrap prices also came under supply-side pressure as a number of scrap deals were reported to have been cancelled by buyers in Bangladesh, following issues with the opening of letters of credit and sellers attempting to divert shipments to Indian ports.
Among the stray deals of the week was a tonnage of 12,000 mt of ex-US containerized shredded scrap at $615-620/mt CFR Kandla port in the west.
$1 = INR 76.60
