The weekly Davis Indexes for all stainless-steel scrap grades rose on an uptick in offers on Nov 17 from the week prior. The official LME nickel contract on Monday settled at $16,083/mt up by $165/mt from a week ago. The index for ss 304 (18-8) solids rose by $21/mt on Tuesday and settled at $1,358/mt cfr India port from the preceding week. Offers were raised on the back of LME nickel’s ascent, strong demand from far east countries and expectations of better demand in the coming weeks from Indian procurers, said traders.
The Davis Index for 316 solids settled at Rs1,955/mt cfr India port, up by $42/mt from a week ago. Some market participants said they heard offers for 316 above $2,000/mt levels on Tuesday.
SS scrap index for 304 and 316 cfr Taiwan also rose on Tuesday. The Davis Index for 304 (18-8) solids Tuesday rose by $5/mt to $1,280/mt cfr Taiwan port from a week ago. Similarly, the index for 316 solids Tuesday rose by $27/mt to $1,877/mt cfr Taiwan port from the previous week. Post COVID-19-related lockdown Taiwanese companies have significantly ramped up operations said mill owners. The rise in manufacturing has aided higher consumption of stainless steel in Taiwan which has consequently led mills to buy more scrap and nickel.
The Davis Index for Zurik Tuesday rose by $34/mt to $1,176/mt cfr India port from the preceding week. Some traders said offers were heard at $1,200/mt cif India port but these levels were deemed too high. Traders expect deals at higher prices only if it is backed by healthy demand. Traders and importers indicated prices are likely to rise further followed by economic revival and resumption of buying by mills post the Diwali break. The weekly Davis Index for 430 solids Tuesday increased by $10/mt to settled at $470/mt cfr India port.
On Tuesday, fewer scrap trades were heard as traders and mills in India are on a Diwali break and would resume a normal level of operations by the end of the week, said market participants.
The recent announcement of production-linked incentive scheme (PLS) in India is likely to benefit the auto, auto parts and specialty steel sector. A boost in production would increase demand for scrap in the coming months which will support prices. Consequently, scrap prices are likely to rise further. The government has laid out a plan worth Rs1.45 trillion ($19.61bn) for a period of five years under PLS for 10 sectors.