The continual shortage of units available for demolition has kept the prices stable across all the recycling markets this week. While the volatility in steel prices is leading to a cautious buying approach, the non-availability of tonnage and the fear to go out of inventory is pushing the end buyers to bid competitively for the available vessels, thereby holding the prices at the same levels without much oscillation.
Oil prices continue their upswing as demand remained resilient while supplies are frayed across the OPEC+ coalition and beyond. The ongoing unrest in Kazakhstan stoked worry that crude supply could be disrupted from the nation whereas at the same time output has dropped in Libya by 200,000 barrels per day due to damaged pipeline. A deep freeze in Canada and the northern U.S. has also disrupted oil flows this week.
The highly affected Cruise ship sector which saw respite for a brief period as the Coronavirus restrictions were relaxed in the later months of 2021 is yet again facing huge losses with recent set of voyage cancellations due to rapid spread of Omicron variant cases.
Industrial metals prices eased on Thursday after minutes from the U.S. Federal Reserve's latest meeting indicated that interest rates might rise quicker than expected, dampening risk appetite as liquidity is the lifeblood of such assets. The market is now pricing in an 80% possibility of a rate hike in March.
The domestic prices have witnessed a slight downward correction this week owing to limited movement of finished steel products, which put selling pressure on the mills. This downtick has made the end buyers reluctant to offer high prices for securing tonnage thereby making them lose units to their subcontinent counterparts where the offer prices are relatively higher.
With effect from 11th January, all international travelers to India have to undergo mandatory home quarantine and get themselves tested on the 8th day of arrival.
The domestic market has picked up pace this week with increase in construction activities thereby boosting the confidence of end buyers on the stability of steel demand in the region. Bangladesh is by far leading the subcontinent market in terms of prices being offered for securing tonnage.
Imported scrap bookings gained momentum this week as the end user market activities have shown positive developments leading to an increase in imported scrap offer prices by about USD 5/MT.
The domestic market is not witnessing much activity as the industry participants are awaiting approval of the finance bill seeking to amend certain laws related to taxes and duties to meet the IMF's conditions for the clearance of Pakistan's sixth review of the $6 billion Extended Fund Facility. Even with limited activity, the offer prices from recyclers of Pakistan remain range bound as many yards are running short on inventory.
The turbulent journey of Pakistani Rupee continues as it closed weaker against dollar on Thursday on the back of lower dollar supplies in the market. It is currently trading at PKR 176.60/USD.
One Cruise ship of about 4000 LDT and an AHTS vessel of about 2000 LDT have arrived in Aliaga this week.
The export demand for Turkish rebar is expected to remain slow during the first quarter of 2022, driven by strong competition amid protective safeguard measures in export markets like Europe and the US. Driven by slow demand, rebar export prices also came under pressure amid high energy costs, a strong scrap market and depreciating Lira.
Lira faces rocky start to the year as the high inflation rate of 36.1% has eroded the confidence of local depositors who are continually exchanging the currency to save their remaining deposits. It is currently trading at TL 13.89/USD.