This week, the import scrap market in Pakistan has remained under pressure from weak finished steel demand. At the same time, import scrap prices have declined slightly in new deals as buyers are seeking lower costs. However, most market insiders so far do not see significant signs of a market recovery after the monsoon season.
More specifically, offers for ex-Europe shredded scrap in containers have settled at $395-400/mt CFR level, against $400/mt CFR last week. According to sources, a deal for around 2,000 mt of ex-EU shredded scrap has been signed at $390/mt CFR this week. Besides, few more deals for around 3,000 mt in total have been reported at $394-396/mt CFR.
Meanwhile, shredded scrap prices from Dubai have still remained competitive compared to European cargoes this week, with several cargoes reported to have been sold at $390-395/mt CFR Qasim, down by $5-8/mt over the past week. Offers for HMS I/II 80:20 and mixed cargoes with PNS scrap from the UAE have been heard at around $370-380/mt CFR, down by $10/mt on the lower end of the range week on week.
At the same time, local demand for finished steel and for local scrap has remained sluggish this week, as political stability is still absent due to “the tug of war between the government and the opposition, while the liquidity crisis isn’t getting better so far”, as one source said. Meanwhile, interest rates have adjusted downward by two percent by the central bank of Pakistan.
Offers for local rebar of grade 60 10-12 mm have been voiced at PKR 255,000-260,000/mt ($915-933/mt) ex-works from mills, while tradable prices have been estimated at PKR 250,000/mt ($897/mt) ex-works, up by PKR 5,000/mt ($18/mt) week on week. Furthermore, offers for local scrap equivalent to shredded have been assessed at PKR 148,000/mt ($531/mt) ex-warehouse, against PKR 146,000-150,000/mt ($524-538/mt) ex-warehouse last week. “Trade is a bit slow. Customers are cautiously optimistic in hopes that a pre-winter hike in demand may appear at any time in the domestic market,” a market sources said.
All prices on Pakistani rupee basis include 18 percent VAT.
$1 = PKR 278.68