Import scrap prices in India have remained largely stable though some offers and bids have been heard at slightly lower levels amid subdued trade activity and a lack of confidence among induction furnace operators, given the prolonged softness of finished steel prices coupled with the cash crunch faced by steel mills, SteelOrbis learned from trade and industry circles on Wednesday, July 10.
Ex-Europe containerized shredded scrap tradable prices are at $410-412/mt CFR Nhava Sheva, moving down by $3/mt on the upper end over the past week. A western Indian-based induction furnace operator cum scrap trader reported a deal for 2,000 mt of shredded scrap at $412/mt CFR, the sources said. But a number of buyers were indicating the tradable price level for them at $405/mt CFR.
HMS (80:20) scrap of UK origin was quoted at $390-400/mt CFR and ex-West Africa origin at $380-390/mt CFR Kandla port. This is relatively stable compared to the reference price for this grade at $385-390/mt CFR for both origins last week.
“Demand for scrap is very weak. There are sufficient local supplies to meet the current level of demand with most secondary mills reporting utilization levels of 80-85 percent,” a Mumbai-based distributor said.
“Also, several mills are believed to be facing a cash crunch. Mills are having to push sales offering extended credit to buyers in the range of 80-90 days, leading to delayed cash flows and a shortage of liquidity to meet operational expenses, including restocking of raw materials,” he said.
According to others in trade circles, sellers are not willing to adjust prices in the sub-continent, citing higher scrap collection costs in Europe and this eliminates any possibility of prices dropping further and hence buying is expected to remain at a low ebb.