Indian steel mills were targeting lower ferrous scrap prices as they see very minimal hopes of recovery in steel demand from the retail and construction market. The demand from infrastructural projects consuming steel made through scrap route have not yet recovered, while strengthening Indian rupee against the US dollar lowered export realizations.
Leading steelmakers raised HRC, CRC, and wire rod prices amid expectations of end-user demand picking up in the automotive and utensil manufacturing sectors in the coming days. Finished flat steel prices for October deliveries rose by a maximum of Rs2,000/mt ($27/mt) boosting market sentiment. However, it is less likely to encourage ferrous scrap trades amid weak end-user demand.
The daily Davis Index for containerized shredded Wednesday settled at $307.13/mt cfr Nhava Sheva, up by $0.13/mt from Tuesday. Most traders and supplier yards offered shredded at $307-310/mt cfr Nhava Sheva on Wednesday against a few trades reported at $305-307/mt cfr Nhava Sheva. Only alloy makers were in a position to book shredded scrap in India while most other buyers prefer domestic scrap over imported. Bids for shredded were below $305/mt cfr Nhava Sheva with buyers unwilling to accept current offers amid weak global cues.
The Davis Index for HMS 1&2 (80:20) of UAE-origin, Wednesday, was at $284/mt cfr Nhava Sheva, flat from Tuesday. Deals for Dubai-origin HMS 1&2 (80:20) were at $283-285/mt cfr Nhava Sheva with some bids heard at $278-280/mt cfr Nhava Sheva. Offers for containerized #1 HMS from Dubai were, however, at $295-300/mt cfr Nhava Sheva against bid levels of upto $290/mt cfr Nhava Sheva on Wednesday.
In the bulk market, weak export sentiments in billet markets in SE Asia and China forced buyers to turn silent. No trade for US-origin HMS 1&2 (80:20) materialized with buyers restraining their bids in the range of $290-295/mt cfr Kandla against offers of $305-310/mt cfr Kandla. Bulk imports have remained non-viable and buyers could stay away for the rest of 2020. Domestic scrap availability has improved with activities gradually returning to pre-COVID-19 levels.
The index for US-origin HMS 1&2 (80:20) Wednesday settled at $286.43/mt cfr Nhava Sheva, up by $0.36/mt from Tuesday. Trades for the US and UK/EU-origin HMS 1&2 (80:20) were at $283-285/mt cfr Nhava Sheva. Most suppliers were unwilling to reduce offers amid indications of demand recovery in October.
Uncertainty in global markets due to China slowing amid the Golden Week holidays and a second wave of COVID-19 in the UK and other European countries could dampen sentiments. Golden Week Holidays has slowed activity even in the Asian billet market.
The Davis Index for containerized shredded, Wednesday, settled at $300.54/mt cfr India subcontinent, up by $0.2/mt from Tuesday. The Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $279.99/mt cfr India subcontinental, up by $0.27/mt from the prior day.