Posted on 01 Jul 2022
Following a protracted downtrend, Indian imported scrap has surged on the back of improving domestic sentiment amid the delayed monsoon, coupled with the scrap supply shortage and low inventories, Kallanish notes.
After booking back-to-back bulk cargoes, mills are seen agreeing to pay more to secure small quantities to run their operations, until they receive their bulk shipments. Moreover, the delayed monsoon is supporting the construction industry, due to which demand for finished long steel is surging, thereby improving the sentiment for semi-finished steel and scrap.
Offers for UK- and EU-origin containerised shredded scrap have surged by $25-30 on-week to $445-450/t cfr Nhava Sheva and Kandla. According to a trading source, Maharashtra-based mills booked small quantities of EU-origin shredded at $445/t cfr Nhava Sheva on Thursday. On Monday, a deal for around 1,000 tonnes of EU-origin shredded was heard at $422-423/t cfr Indian west coast.
Following the bulk deal for 42,000t of US-origin shredded scrap concluded last week at $395/t cfr Chennai and Kandla, offers have risen $5-10/t to $400-405/cfr Kandla and Chennai. However, no deals have struck this week for bulk shipments.
“There is a material [scrap] shortage in India and the delayed monsoon has increased demand for billet and rebar in the nation, which is why we are seeing a surge in offers starting from rebar to billet and scrap,” informs a mill source.
“Moreover, we are waiting to receive our bulk shipments, which are expected to arrive in July, and by the time we receive them, we will continue to procure small packages to run our operations,” he adds.
Offers for United Arab Emirates-origin HMS1 surged by $20/t on-week to $460-465/t cfr Nhava Sheva and Kandla. A North India-based mill procured around 1,000t of UAE HMS1 on Thursday at $460/t cfr Kandla.
On 24 June, a bulk deal for 35,000t of Latvia-origin HMS 80:20 was heard concluded at $366/t cfr Kandla; offers for the same origin are now heard at $380-385/t cfr Kandla.
"The market started to pick from Monday and we are witnessing a noticeable daily rise in offers," says a Gujarat-based mill source. "I think this rise is for the short-term and we might see a fall after ten days, on the arrival of the monsoon."
UAE-origin HMS 1&2 80:20 (auto mix) offers are currently hovering at $440-445/t cfr Nhava Sheva and Kandla. West African-origin HMS 1&2 80:20 offers are heard at $430/t cfr Mundra and $420/t cfr Kandla.
Indian domestic scrap offers are meanwhile noted at $534/t ex-North India, $545/t ex-Central India, $538/t ex-East India and $506/t ex-West India.
Meanwhile, offers for ship scrap from containers plunged to $610/light displacement tonne (ldt). Scrap from dry bulkers and tankers is hovering at $590/ldt and $600/ldt, respectively.
Source:Kallanish
