No scrap deals to India until August, trader says
India is unlikely to buy any more scrap on the international market until August, a market source told Steel First on Tuesday July 2.
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The latest trade he saw into India was in mid-June, he added.
Containerised scrap shipments to India have stalled recently because of the rupee’s extreme weakness against the US dollar.
Scrap importers buy in dollars and sell on the local market in rupees, making trade unprofitable when the rupee is weakening.
The rupee has lost 10% of its value in the past 60 days. It was worth $0.0168 on July 2, compared with $0.0186 on May 4, according to data from exchange rate website Oanda.com.
Indian mills can subsist on locally produced direct reduction iron (DRI) and scrap sales from distressed cargoes at port for a while, according to the trader.
“Once a year or so, the Indian market goes dead,” the trader said. “They might hold out long enough for purchase prices to come down.”
However, there were unconfirmed reports of some thin trading on July 2 in a $360-365 per tonne range for containerised shredded scrap delivered Nhava Sheva, according to a UK-based merchant.
The price range was unchanged from Friday, when the Metal Bulletin index for containerised shredded scrap delivered to India closed at $362.50 per tonne.