NEW YORK Indian steel mills have significantly lowered their bids for ferrous scrap over the past few days, market participants said, resulting in a complete halt to U.S. exports of containerized scrap to the nation.
Indian bids for containerized shredded scrap from the U.S. East Coast dropped to a range of $400 to $410 per tonne delivered to Mumbais Nhava Sheva port by the end of last week, down from sales at $424 to $430 per tonne c.f.r. Nhava Sheva earlier in the week.
Several market participants had told AMM that they were expecting export tags to India to soften due to poor currency market conditions and struggling finished product sales (amm.com, Nov. 20).
However, most sources said the $20 to $25 drop in bids has done little to deter U.S. exporters from continuing to offer scrap at the levels seen early last week, with only a few sources reporting some exporters lowering offer prices.
"Starting from last week, prices have weakened by $5 to $10 per tonne. Shredded from Europe was offered at (the) $424 to $425 level, meaning $420 ex-U.S. It is difficult to find buyers even at $420 today," one source said.
A second source, based in Mumbai, said sellers offers have yet to drop below $420 per tonne for shredded. "Most offers are still between $425 and $430, and some U.S. sellers (are) even offering levels of $435," he said.
"With the India rupee trading at up to 56 against the U.S. dollar, the sentiment is weak. It may reverse in the next day or two," a third source said.
Exporters willing to drop offer prices could still struggle to book shipments, according to a fourth source. "At higher offer levels, there are no buyers in India at the moment. Even at $410 it is difficult to generate sales, as many factories are thinking of shutting down or reducing their production as losses are tremendous," he said.
"Most buyers are looking for $410 into Nhava Sheva, and I have yet to see that price actually conclude business," a fifth source said.
Most participants said the market prices wouldnt find firm footing on trades until at least next week.
"This large disparity between bids and offers is typical for the last trading week of any month. I expect things to become clearer next week," a sixth source said.