Import scrap prices in India have softened in the past week with buyers staying on the sidelines owing to a combination of sufficient inventories of raw material and finished steel and the sharp depreciation of the Indian currency increasing the landed price of imports, SteelOrbis learned from trade and industry circles on Wednesday, November 20.
Ex-Europe/UK containerized shredded scrap offers are in the range of $390-395/mt CFR Nhava Sheva port in the west compared to $400-405/mt CFR a week ago, and with scattered bids heard at least $5/mt lower, while no deals have been confirmed in the market over the past week. The reference price has come to $385-395/mt CFR, down by $7.5/mt on average over the past week.
The HMS (80:20) price has been reported at $365-370/mt CFR, down from $380-390/mt CFR for ex-UK material, but no buyers have been present in the market.
According to the sources, the Indian rupee depreciating and maintaining a low of INR 84.40 against the US dollar has increased the landed price of imports even after factoring in the lower CFR price, and induction furnace operators have stayed away from bookings unsure of being able to pass on higher costs at a time when rebar prices have entered a new downtrend.
“There is sufficient local availability of raw materials. Secondary mills are also seeing a rise in inventories of finished steel and are not interested in increasing raw material inventories. Imported raw material also carries higher risks of a volatile currency exchange rate,” a Mumbai-based ferrous and non-ferrous scrap trader said.
“The global scrap market also seems to have bottomed out and prices look to rebound for January-February bookings. And with local steel prices unlikely to recover, the scrap import trade will be minimal going forward,” he said.