OfBusiness MS Scrap Dailies

24th May’23

Price

• The prices of Mild Steel (MS) Scrap in the Chennai market have remained consistent for consecutive days.
• Currently, the market rates for various categories of MS Scrap are as follows, ex-plant Chennai basis:
  • Godown: Rs. 34.00/kg
  • Bazaar: Rs. 33.00/kg
  • Commercial: Rs. 32.00/kg
  • Boring: Rs. 33.00/kg
  • Godown heavy: Rs. 35.00/kg
  • Super: Rs. 35.50/kg.

Demand and Supply

• The demand for MS Scrap continues to be primarily influenced by the demand for Finished Goods (FG), leading manufacturers to adopt a chase strategy amid the prevailing low market sentiment. Considering the persisting GST issues, manufacturers have shown a preference for imported Scrap supply due to the assurance of origin authenticity, despite weaker demands. However, recent trends indicate a shift towards local Scrap supply to meet the subdued demand.

News

• The imported Ferrous Scrap market in South Asia has witnessed limited trade activity, resulting in price stability in both India and Bangladesh. The political instability in Pakistan has rendered the market inactive. Within India, the import prices for favored grades like shredded and HMS have remained stable, mainly due to a limited number of inquiries.
• On the other hand, Bangladesh has experienced a subdued market due to liquidity issues and challenges in opening letters of credit, with market participants eagerly awaiting the budget declaration.
• Meanwhile, in Turkiye, imported Ferrous Scrap prices have remained range-bound as market activity paused, anticipating the upcoming second round of the Turkish presidential election scheduled for 28 May.

OFB’s Opinion

• The low to stagnant demand for FG products has contributed to a scenario where prices of MS Scrap remain within a certain range. Moving forward, the prices of MS Scrap may continue to be influenced by the demand in the FG market, as the availability of local goods remains within tolerable limits. Additionally, there is an anticipated increase in the usage of sponge iron for the production of billets and ingots.