Indian import scrap prices posted decline with no deals concluded amid concerns among both buyers and sellers over supply-chain risks from re-routing of maritime routes following security issues in Red Sea, SteelOrbis learned from trade and industry circles on Wednesday, December 20.
Ex-Europe containerized shredded scrap offers were reported at $418-420/mt CFR this week, down from $425-428/mt CFR seen last week, but no deals were confirmed at any of the price ranges. Moreover, the tradable level was closer to $415/mt CFR at the moment, down by $5/mt from bids last week.
Sources said that HMS (80:20) scrap of Europe origin was offered at $395-400/mt CFR Nhava Sheva, lower than $405-410/mt CFR a week ago.
“The current prices are not favorable for local buyers among induction furnace operators amid renewed pressures on finished steel prices. There is no clarity on short term price trend either and we think it will get clearer after the winter holidays,” a Mumbai based trader said.
“Import prices can only rise post-holidays. But we don’t think that local secondary mills will be able to absorb higher prices at a time when rebar prices are seeking lower levels steadily. Alternative options in the local market like sponge iron are the preferred raw material,” he said.
Several in trade circles said that even though it is early to make specific assessment, security risks to maritime trade in Red Sea will have a big impact on trade with shipping lines starting to divert routes. Current offers have not yet factored in this risk and potential rise in freight rates. But once more liners avoid the Europe-Indian Ocean route through the Red Sea, impact on supply chain will get clearer and deeper, trader pointed out.