Pakistani mills raised their bids by $15/mt from a day ago to secure material. But sellers, bullish amid a rise in Turkish prices, increased their asking prices by $20/mt from Monday and were unwilling to negotiate at lower prices.
Limited scrap availability and vessel space constraints have also lifted prices. Global container freight rates could move up further in March after China returns from the New Year holidays.
Some buyers could resume bookings only after Chinese mills return to the market and lift semi-finished steel prices. Others waited for domestic finished steel prices to rise further. In the last two days, finished steel prices in Pakistan rose by PKR1,500-2,000/mt ($9-12/mt) ex-works.
The daily Davis Index for containerized shredded, Tuesday, rose by $21.25/mt to $443.75/mt cfr Port Qasim. Trades for the grade from the UK/EU were at $435-440/mt cfr Port Qasim. Some sellers from the UK offered shredded at $450-455/mt cfr Port Qasim amid expectations of a healthy demand outlook for the next two months.
In Turkey, strengthening domestic scrap and rebar prices by $10-15/mt are expected to push ferrous scrap prices up. Mills are expected to start a new round of bulk bookings at $415-420/mt cfr Turkey for HMS 1&2 (80:20). Overseas scrap purchase prices could rise by $20-30/mt until the end of February. On Tuesday, shipbreaking scrap in Turkey rose by $10/mt to $385/mt delivered mills.
The daily index for US-origin HMS 1&2 (80:20) settled at $403.75/mt cfr Port Qasim, up by $15.89/mt. In the US domestic market, demand for ferrous scrap remained bullish aided by record-high HRC prices. Most sellers could focus on the domestic market until they get desired prices from subcontinental buyers. A few yards offered containerized HMS 1&2 (80:20) at $405-410/mt cfr Port Qasim on Tuesday.
Offers for the UAE-origin HMS remained on an uptrend amid rising demand. Indian secondary steel producers resumed trades for Dubai-origin HMS and lifted their bids by $20-30/mt from the prior week. Offers for #1 HMS and P&S from UAE were at $405-415/mt cfr Port Qasim, depending on quality. The daily Davis Index for UAE-origin HMS 1&2 (80:20), Tuesday, rose by $15/mt to $403/mt cfr Port Qasim.
Domestic steel prices on an uptrend
In Lahore, Bala billet prices were at PKR100,000-100,500/mt ($624.8-627.9/mt) ex-works, up by PKR1,500-2,000/mt from late last week. Bala billet prices have recovered by over PKR6,000-6,500/mt from their lowest in late January. Demand, however, is still short of mills’ expectations.
Prices for domestic scrap Pure Q Toke equivalent to shredded were at PKR81,000/mt ex-yards Lahore. Rebar was offered at PKR125,000-127,000/mt ex-works Karachi, excluding discounts. In Punjab, rebar traded at PKR123,000-125,000/mt ex-works with a few mills mulling price hikes to offset rising raw material costs.
Pakistan Rupee has depreciated to PKR160.1 against $1 on Tuesday from PKR158.5 on Friday. Depreciation of currency could also push domestic steel prices up in the coming days in the country, believe experts.