Ferrous scrap prices rose in Pakistan despite slow demand ahead of the Eid holidays. The government has announced national holidays from May 10-15 while market participants expect trading to remain suspended from Sunday, May 9 to Monday, May 17. The country is also observing stringent restrictions on the movement of people and goods due to the resurgence of COVID-19, but steel production remains unimpacted.
The daily Davis Index for containerized shredded, Thursday, settled at $487.5/mt cfr Port Qasim, up by $6.25/mt from Wednesday. On Thursday, offers from the UK/EU origin rose by $5/mt reaching $490-495/mt cfr Qasim although mills have slowed purchases ahead of Eid holidays. As demand outpaces the supply of ferrous scrap, globally, prices jumped both in the containers and bulk markets.
In Turkey, demand for ferrous scrap turned active in the bulk market encouraged by bullish steel prices. Market participants expect prices to rise in the coming days in line with an increase in domestic rebar prices. The daily index for bulk US-origin HMS 1&2 (80:20) Wednesday rose to $470.86/mt cfr Turkey up over $12.76/mt.
The daily index for US-origin HMS 1&2 (80:20), Thursday, gained $7.5/mt to $462.5/mt cfr Port Qasim. Trades were limited while offers continued to rise to scale $465/mt cfr Qasim on Thursday. Most US suppliers are preparing for bullish domestic demand in May and are likely to prefer domestic trades over seaborne trades amid logistics challenges.
The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $462/mt cfr Port Qasim, up by $6/mt. Importers booked UAE-origin mixed #1 HMS and P&S in containers at $470/mt cfr Qasim pushing offers upto $475/mt cfr Qasim amid increasing demand from Indian mills. UAE-based traders are hopeful of more deals in the coming days supported by a pick-up in steel demand post-Eid.
In the domestic market, Bala billet offered at PKR111,800-112,000/mt ex-works Lahore on Thursday, maintaining the uptrend. Offers for G-60 billet at PKR115,500-116,000/mt ex-works Punjab against buying interest at PKR115,000/mt ex-works Punjab stable from a day prior.
Following rising raw materials prices and high input costs, most large steelmakers in Punjab and Karachi decided to lift rebar asking prices. Mills are optimistic about steel demand post-Eid. For rebar, offers rose to PKR136,000-137,000/mt ex-works Karachi and PKR132,000-132,500/mt ex-works Punjab. Local rebar sold at PKR121,500-122,000/mt ex-works Punjab.
Higher imported ferrous scrap prices are expected to lift the price and demand for domestic scrap. Art Q toke scrap equivalent to a mix of HMS and P&S traded at PKR90,000-90,200/mt ex-yard Lahore. Pure Q toke scrap (equivalent to shredded) rose to PKR91,200-91,500/mt ex-yard Lahore.