Domestic scrap prices in Pakistan have rebounded after a dip last week with seller’s offers firm despite slow buying momentum. There were initially worries that scrap prices in the local market would fall lower as production controls were tightened in Punjab due to smog, however, material shortages and the need for restocking has kept prices supported.
Tradeable values as per market sources in Lahore have risen as compared to the start of the week, however, prices are still lower from the same time a week ago. Traders quoted Domestic Q-Tok (shredded equivalent) at Rs126,750-127,000/t Ex-Lahore, up Rs2000/t from Monday, November 22nd 2021; while prices for Arat Tok were heard between Rs121,000-121,250/t Ex-Lahore, up from 119,850/t on Monday this week.
Participants in the local industry do not see any major near term corrections with regards to raw materials as finished steel prices in Pakistan remain elevated, supported by demand from PSDP projects with closer deadlines, moreover, expectations of supply shortages resulting in a lack of material availability in the international markets during winter months have also kept buyers cautious, with limited restocking achieved amid a weaker rupee dollar parity that has largely impacted import costs. During the past week imported scrap offers into Pakistan were assessed between $555-560/t CFR, with only a limited number of deals reported by participants between $550-555/t CFR Port Qasim. The SteelBis weekly steel scrap, shredded, index, import, CFR Port Qasim, Pakistan was at $552.6/t on Wednesday, November 24th 2021, down from $556.1/t a week earlier.
Prices have been slightly under pressure amidst a cooling off seen in the Bangladeshi and Turkish markets this week and a relative easing in the container shipping markets. Market participants feel buyers would leap at the chance of negotiating further cargoes as the trend in South Asia gains clarity.