Steel market developments are likely to be subject to a high level of uncertainty for 2022 and 2023, which will continue to undermine demand from steel-using sectors. The ship recycling market is echoing the widespread gloomy economic sentiments as the end buyers have lowered their offers in view of the declining steel demand and corrections in prices. This week remained particularly silent due to the Eid holidays and a clear direction of prices will be determined when the market participants return to action next week. India is still leading the price board albeit a USD 15/LDT decline in offer prices as its neighbouring counterparts remain silent due to the ongoing holidays and dwindling steel prices in their domestic markets.
Crude oil prices jumped on Wednesday after the European Union planned to end imports of Russian oil, fueling concerns over further tightening in global oil supply. Hungary has warned that it cannot accept the EU’s planned ban on Russian oil as it would amount to an “atomic bomb” for its economy, threatening to scupper the bloc’s sixth sanctions package against Moscow. WTI is currently trading at USD 110.40 per barrel.
The Federal Reserve intensified its fight against the worst inflation in 40 years by raising its benchmark interest rate by a half-percentage point –its most aggressive move since 2000 and signalled further large rate hikes to come. The ripple effect of this monetary tightening will be soon reflected in every aspect of the economy.
Iron ore prices slide following an announcement from Chinese authorities reaffirming China’s commitment to its zero-Covid strategy along with slow post-holiday demand pick-up for the steelmaking ingredient.
The recyclers from Alang have slightly decreased their offers amid falling international scrap prices and moderate steel demand in the domestic market. Export prices are likely to see some clarity next week when major importing nations resume work after holidays.
HRC and CRC prices continued to decline amid slow trade momentum this week. The end user industries are sticking to need based procurement at the current price levels. Prices are likely to remain adjusted in the near term, however, mills remain concerned about the cost push due to higher power tariffs and outages.
India is currently undergoing an acute power crisis due to shortage of coal compounded by extreme heatwave across the country
End buyers of Chattogram remained inactive this week as the market was closed for Eid holidays. Market participants are awaiting the resumption of trading activities next week to gauge a clear direction for scrap prices amid plummeting international scrap prices.
Imported scrap prices further softened by about USD 10-15/MT this week.
Prices of mild-steel rod have dropped by USD 70-90/MT offering a relief to construction sector where multiple projects have been kept on halt due to surging prices of building materials
The market remained closed this week owing to Eid holidays thereby leading to no buying inquiries from the recyclers of Gadani. The sentiments of domestic market will be ascertained as the markets reopen next week.
Bulk HRC imports into Pakistan have dropped to their lowest level since Aug’20 amidst political instability, high raw-material costs, volatile prices and global trade disruptions caused by the ongoing Russia-Ukraine conflict weighing on buying interest.
The Pakistani Rupee continues to slide amid depleting foreign reserves in the country and is currently trading at PKR 186.67/USD.
Imported scrap prices have dropped by about USD 20/MT week on week.
Steel demand continues its downward trend leading to a further softening of about USD 10/MT in imported scrap prices and a decline of about USD 5/MT in the domestic market.
Market was closed till Thursday this week due to the Eid festival, therefore, a clearer picture of actual demand and prices will emerge next week when the trading activities resume in full form.
Inflation in Turkey soared by 69.97% in April compared with the previous year as per the official data released this week. Turkish Lira fell further against USD and is currently trading at TL 14.93/USD