NEW YORK The
Indian steel scrap market appears to be divided, with larger
producers marking a gradual return and smaller producers still
waiting on the sidelines.
In recent trade, the
countrys imports of shredded scrap were reported in a
range of $365 to $370 per tonne c.f.r. Nhava Sheva, but market
participants were quick to note that only a handful of large
producers traded at that level.
For the rest of the
market, bids for shredded scrap were reported in a range of
$350 to $355 per tonne, while offers from the United States,
the United Kingdom and continental Europe reportedly increased
following the sales to large producers. Offers were mostly
reported in a range of $365 to $375 per tonne, although one
trader said offers from Europe have trekked as high as $385 to
$390 per tonne.
This apparent divide
between Indian mills that can afford to import scrap at current
global trade levels and those that cant due to weak
business conditions has resulted in split opinions on the
near-term direction of the Indian market.
"(The) market is
sluggish and we dont see much demand coming in the next
two months regardless of the currency going either way," one
"The situation is
still very dull in India and most buyers are operating at a
third of their capacity, hence their requirement of scrap is
down substantially," a second exporter said.
prices are unworkable for most of the factories and there are
no buyers above $350 to $355 levels for shredded, except for a
few big factories who bought last at $368 to $370 levels. I
guess the buying will be slow for another month at least and
then the situation should improve a bit. However, I do not
think factories will be operating at full capacity until the
beginning of next year," he added.
Most of the scrap sold
into India has originated from the Middle East and Africa, and
no sales were confirmed out of Europe and the United States,
For the few suppliers
that were able to sell to large producers, the market looks
"Indian mills seem to
be coming back into the market. Finally!" one trader said.
"With the rupee somewhat stable at levels of 62 to
63 (to the U.S. dollar) we are seeing mills in Chennai and
Nhava Sheva buying shred at levels of $370 c.f.r. basis. ...
Hopefully we have turned the corner and the last few months of
the year will be good in terms of steel and scrap demand."
Apart from some
producers accepting the new base levels of the Indian rupee
against the dollar, the construction industry has gained
momentum with the end of the monsoon season, another trader
said. Getting business done is a bit hard due to stiff
competition, but momentum is picking up, he added.
"We are also getting
some good demand from Chennai-based buyers for shred and are
currently concentrating (on them)," he said.