Import scrap prices in India have moved up with sellers anticipating the market to have bottomed out, but local buyers have continued to bid low against the backdrop of weak finished steel prices and weak raw material demand, resulting in low trading activity, SteelOrbis learned from trade and industry circles on Wednesday, March 27.
Ex-Europe containerized shredded scrap prices have rebounded to $410-415/t CFR Nhava Sheva port in the west, compared to $400-410/mt CFR a week ago, while ex-UK HMS (80:20) scrap has been reported in the range of $375-385/mt CFR, up from $360-365/mt CFR a week ago.
However, bids submitted have on average been lower than offers and so no significant deals have been concluded over the past week.
Sources said that induction furnace operators are cautious over plant utilization levels in view of weak long product prices and sufficient inventories, and are under less pressure to restock imported raw materials. Also, alternative sponge iron prices are seen to be softening in the local market, offering a cheaper option.
The sources said that, despite the view that the downtrend in import prices may have run its course and that a recovery may be around the corner, local secondary mills are not rushing in to make immediate deals.
“We expect the current dormant trade conditions to continue for two to three weeks more for the holidays and the year-end considerations to expire. Buying activity will resume towards the end of April for May-June deliveries. This will coincide with the end of the national elections, the revival of activities by long steel consuming sectors and mills being in a better position to increase output and restock raw materials,” a Mumbai-based ferrous and non-ferrous trader said.
“However, if long product demand remains weak, it could lead to resistance from buyers. But sellers are unlikely to adjust considering the uptrend seen in key markets like Turkey,” he said.