The Indian Ferrous Scrap market continues to flourish, with current Scrap prices hitting over three-month highs in the west and south regions. The growth can be attributed to active Steel demand, higher import offers, and prevailing optimism within the sector. Let’s explore more about the same:

Active Demand Boosts Scrap Prices

Over a week, Scrap prices surged by an impressive Rs 300-1,500/ton (equivalent to $4-18). Notably, the most significant price increase of Rs 1,000-1,500/ton was observed in northern and western India.

The latest Scrap prices in various regions are as follows:

Mandi Gobindgarh: Rs 39,500-40,000/ton ex-works (a week-on-week increase of Rs 1,000/ton).
Raipur: Rs 38,500-39,000/ton ex-works (a week-on-week increase of Rs 300/ton).
Durgapur: Rs 39,500-40,000/ton (a week-on-week increase of Rs 300-500/ton).
Alang: Rs 39,300/ton ex-works (a week-on-week increase of Rs 500/ton).
Jalna: Rs 38,000-38,500/ton (a week-on-week increase of Rs 1,000-1,500/ton).
Chennai: Rs 36,000-36,500/ton ex-Chennai (a week-on-week increase of Rs 300-500/ton).

Balanced Supply & Demand

Participants in the south, west, and north regions emphasize that the current scenario reflects a balanced supply and demand dynamic for Scrap. The improved Steel demand in the country is contributing significantly to this equilibrium. Furthermore, the elevated Scrap import prices have enabled local Scrap suppliers to maintain higher prices, as imported materials continue to be costly. This trend bodes well for the Ferrous industry in India, fostering a positive outlook.

Import Offers

While domestic Scrap prices continue to rise, import offers have witnessed a slight decline of $3-5/ton week-on-week. This decline can be attributed to a slightly reduced buying interest in the global market, particularly from Turkey, a prominent global buyer. Presently, European-origin Shredded Scrap is being offered at $430-435/ton CFR India’s west coast for containerized bookings.

Market Outlook

Industry experts are optimistic about the future of the Indian Ferrous Scrap market, foreseeing limited potential for significant price drops. The current season favors strong Steel demand in the country. Additionally, the higher Scrap import offers, along with the increased substitute product costs such as Sponge Iron and Pig Iron, are key factors that are likely to continue supporting the Ferrous Scrap market in the Indian domestic arena.

OFB’s Insight

The Indian Ferrous Scrap industry is experiencing a buoyant period, driven by active Steel demand and favorable market conditions. The balanced supply-demand dynamics and optimistic market outlook suggest a promising trajectory for the sector in the near future, with minimal likelihood of significant price drops.