Delays in the issuance of letters of credit (LC) have affected the import of scrap materials in Pakistan. Despite stable offers, trade volumes remained low in the previous week. Quotes for shredded scrap originating from the UK and EU remained unchanged at $435-440 per tonne, cost and freight (cfr) Port Qasim.
Towards the end of the week, most deals were concluded at $437-438 per tonne, cfr Port Qasim. Some trades involving shredded and PNS scrap from the UAE were reported at $440-445 per tonne, cfr, while PNS scrap from UAE was traded at $415-420 per tonne, cfr Port Qasim.
Busheling scrap from Poland was sold at $460 per tonne, cfr Port Qasim, and busheling scrap from Brazil was booked at $452-454 per tonne, cfr Port Qasim. The delays in LC issuance have had an impact on trade in Pakistan as banks are currently restricting buyers from opening LCs for large volumes. However, it is expected that this situation will improve in July, after the fiscal year ends.
Domestic steel demand is currently low, leading to a decrease in the uptake of finished steel products. The prices for local billet (bala) in Lahore are approximately PKR 210,000 per tonne ($732). Different mills offer varying prices for grade-60 rebar, with tier-2 mills offering at PKR 260,000 per tonne, ex-Lahore, tier-1 mills at PKR 262,000-265,000 per tonne, ex-Pakistan, and tier-3 mills at PKR 250,000-255,000 per tonne, ex-Pakistan.
Raw materials have become more expensive, while finished steel products have become cheaper in Pakistan. The country is facing a cash liquidity issue, resulting in a similar sluggishness as observed last year. Prices for ship scrap from containers are noted at $550 per light displacement tonne (ldt), while scrap from dry bulkers and tankers is priced at $510/ldt and $530/ldt, respectively.
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