Imported ferrous scrap offers in India trended up amid bullish global cues on Monday. Indian buyers are stepping back unlike their subcontinental peers in Pakistan and Bangladesh, where inquiries are active. Importers await clarity on fresh offers as there are very few firm offers in the market.
Indian domestic steel market remained upbeat both in terms of demand and prices. Domestic rebar and HRC prices are offering better margins for all leading mills in Q3 compared to the prior quarters. Secondary mills are still slower on imported scrap purchases and prefer domestic scrap and Sponge iron. Finished steel inventories are very low amid rising demand, which is expected to keep scrap prices up this week, anticipate traders.
The Davis Index for containerized shredded on Monday settled at $394.38/mt cfr Nhava Sheva up by $11.52/mt from Friday. On Friday a deal for the US origin shredded concluded at $390-392/mt cfr Nhava Sheva while offers on Monday were largely above $395/mt cfr Nhava Sheva. A few offers were reported at $400-405/mt cfr Chennai. Buyers are expected to resume trades this week paying $5-10/mt higher over this week. Steel demand in the domestic market could stay strong offering better realisations than exports.
The Davis Index for UAE-origin HMS 1&2 (80:20) Monday settled at $371/mt cfr Nhava Sheva, up by $7/mt from Friday. Offers for containerized #1 HMS without the cast and galvanized iron from Dubai were at prices above $380-385/mt cfr Nhava Sheva on Monday after the conclusion of $378/mt cfr on Friday. Domestic scrap remained a preferred choice for many buyers amid uncertainty around delivery schedule of imported material.
The Davis Index for US-origin HMS 1&2 (80:20) was at $370/mt cfr Nhava Sheva on Friday, up by $5.5/mt from Friday with fresh offers for end January shipments at $370-375/mt cfr Nhava Sheva. There were no fresh offers from the US and Australian bulk suppliers.
High imported scrap prices pushed up billet export prices, with some Indian mills targeting $520-530/mt fob India.
With international iron ore prices (Australian 62pc Fe content) at seven-year’s high of $145/mt cfr China. Chinese HRC prices rose to $610-620/mt fob depending on the grade. On Monday, Chinese producers offered domestic billets at CNY3,620/mt ex-Tangshan, up by CNY40/mt from Friday. Steel futures gained.
The Davis Index for containerized shredded, Monday, settled at $395.23/mt cfr India subcontinent, up by $11.99/mt from Friday. The Davis Index for containerized US-origin HMS 1&2 (80:20) was at $370.21/mt cfr India subcontinent, up by $4.98/mt from Friday.
Taiwanese mills resorted to buying limited volumes amid rising offers on Monday. The Davis Index for containerized US-origin HMS 1&2 (80:20), Monday, rose by $8/mt from Friday to $330/mt cfr Taiwan. A few deals were also at $330/mt cfr Taiwan late Friday and on Monday. Most mills held their bid at $325/mt on Monday
To avoid buying imported scrap at such high prices and in anticipation of a future correction in global scrap prices, Feng Hsin raised finished steel and domestic ferrous scrap prices by TWD300/mt ($7/mt) from the prior week and is likely to increase offers further to offset higher input costs and focus on purchasing more domestic scrap. This is the second raise by Feng Hsin in December. Japan’s domestic scrap prices too rose by around $60/mt since mid-November.
After the revision, Feng Hsin’s base offers for rebar were at TWD16,000-16,300/mt ex-works southern and northern mills.
The Davis Index for US-origin HMS 1&2 (80:20) in Turkey rose by $8/mt on Friday from Dec 03, lifting global ferrous scrap prices, which remain unviable for mills in Taiwan.