Prices offered by ship recyclers improved marginally by US$5/LT
Plate prices in India has improved last week (ended 11 Nov) by US$6/MT, but the overall steel market is weak, and prices are subdued, according to a weekly report by the Wirana Shipping Corp.
Imported scrap prices increased by another US$6/MT last week though this increase is in line with a global increase seen during the week.
Secondary mills are not restocking materials because of the weak demand and reduced prices of local rebars.
“While the holiday season (Diwali) has a role to play in lower demand, there are some players in the market who feel that demand from the construction sector will not fully pick up after the holidays, but we need to see it closely,” said the report.
With rising raw material prices and increasing costs, steel mills would be constrained to push up the prices even if it means demand slows down, according to the report.
Reducing crude oil prices will support local currency and more so because of slowing exports data seen in September.
India’ unemployment rate stood at 10.05% in October and could increase if GDP growth rate continues at present 6% – 6.50% though this is more of a longer-term issue and not of immediate concern.
“We have seen active interest in buying fresh tonnages from ship recyclers but prices at which some deals have been concluded this week are at higher levels than what a ship recycler would be willing to pay today,” said the report.
“Prices offered by ship recyclers improved marginally by about US$5/LT LDT and considering the weak local steel market but improving global steel prices, we would expect prices offered by ship recyclers for fresh tonnages to move up marginally,” it said.
Supply of fresh tonnages for recycling is expected to be generally slow till the end of the year and with improving sentiments in global steel market, prices for fresh tonnages could enjoy a good market till then.
“It would be a gradual improvement as local steel market may not reflect global sentiments immediately,” the report said. fiinews.com
