World’s top steel producer’s tanking favours 2 other dominant scrap yards
China’s bid to reduce carbon emission by controlling steel output turned out to be a lucrative opportunity for India and Bangladesh – filling the shortage gap.
Bangladesh and India’s scorecard
GMS, a renowned ship buyer said, “A noticeable degree of concern remains evident in the sub-continent ship recycling markets, as both Bangladesh and (especially) India witnessed unexpected declines in steel plate prices. Bangladesh saw steel prices cool off and jump back up by about US$ 20/LDT over the last couple of weeks. A healthy number of Bangladeshi buyers have subsequently decided to wait and watch market developments before offering firm on any fresh units.
“Even in India – where the situation is worse with plate prices fell even more than Bangladesh’s, Alang Buyers are also re-evaluating their offers and as such. We have seen several cash buyers hesitant on their offers for certain India-only units, where levels escalated well beyond comfort levels.”
Both countries are expecting their steel prices to not deviate downwards given China’s current stance on steel output for environmental causes. China’s National Bureau of Statistics (NBS) revealed the country’s flat steel profit margins remained strong in July despite their curbs. Some market sources anticipated a soft manufacturing of machinery for H2 2022.
China’s support through curbs
2 major mills in Jiangsu province reportedly lowered their domestic scrap purchase prices by RMB50 ($8) / tonne early August amid continuous production cuts. The last few weeks have been stagnant for the republic due to curbing measures. This steel shortfall is the perfect opportunity for India and Bangladesh to fill the gap. However, it is a delicate game as many businesses may fall prey to the mistake of quoting unwelcoming rates.
Marine Online News Team
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