Pakistan: Imported scrap offers surge to eight-months high post holidays

Pakistan's steel market has resumed trades after Muharram/Ashura holidays last weekend. Although imported scrap trades are not much active, yet offers have increased sharply against last week.

SteelMint's assessment for Shredded 211 scrap in containers from UK/Europe remains at $318/t CFR Qasim, up by $7/t against last week’s opening. Prices have climbed to an eight-months high as similar levels were seen in Jan'20.

• Scrap suppliers are offering $315-320/t CFR level for shredded in containers for Uk/Europe origin, few deals are happening at $318/t CFR level.
  
  
• Dubai HMS scrap is being offered at around $295/t CFR level.
  
  
• Whereas, PNS from Dubai is being sold at around $305/t CFR basis.
  
  

“Some customers have decided to wait and watch until it is feasible to buy, produce and sell the finished products as at current domestic steel prices, it is not feasible to pay such high prices for scrap” shared a Pakistan based scrap trader.

Pakistan Steel melters association raise concerns against taxation - On Monday, the Pakistan Steel Melters Association (PSMA) has raised its voice regarding taxation related issues being faced by the industry and urged the government to resolve its problems immediately.

Currently, steel melters (PSMS) pay PKR 12,140 in sales tax, PKR 1,100 in income tax, and an additional PKR 1,000 in the form of other taxes, whereas other competitive steel melting associations operating in Federally Administered Tribal Areas (FATA) and Provincially Administered Tribal Areas (PATA) do not pay taxes, as per reports.

The steel melting industry is one of the largest revenue-generating sectors of the country. Many steel manufacturer pays sales tax on the import of steel scrap and ferrous-alloys, even though, a large number of scrap dealers located in Lahore and Karachi region, who avoid paying taxes has not registered by the government.

Domestic steel market overview- Pakistan domestic steel prices have remained range-bound.

• Local scrap (equivalent to shredded) price stands at PKR 71,500/t, inclusive of taxes
  
  
• Deformed bar (Grade 60) offers by Punjab region mills remained firm at PKR 111,000-112,000/t ex plant and PKR 112,000/t for South region mills, ex plant inclusive of all taxes.
  
  

Pakistan Domestic Steel Prices as on 1st Sept'20