Highlights

  • The CFR India scrap benchmark closed at US$390/t on 5 Nov, down from US$395/t a week earlier, and trade stayed stalled through 11 Nov.
  • Falling domestic scrap and sponge iron, weak rebar Demand and the Diwali holidays gave mills no reason to buy imports.
  • Firm prices in Turkey and the US keep exporters from chasing Indian bids lower; watch post-Diwali steel demand and local scrap in Mandi Gobindgarh.

India's Import scrap market has slipped and then frozen, as cheaper local feedstock and a festive lull leave overseas sellers without buyers.

What happened

India's imported scrap market has drifted lower and then gone almost silent. The CFR India scrap benchmark, which underpins the LME's India contract, closed the LME two-month position at US$390/t on 5 November. A week earlier it was US$395/t, a 1.3% fall computed from those two closes.

The decline has been steady rather than sharp. The same benchmark stood at US$404.20/t on 15 October, so it has lost about 3.5% in three weeks. On the LME, every India contract from November 2026 to January 2028 showed US$390/t on 11 November, with no trades.

This is not a one-week story. A run of quiet weeks has built up, from subdued buying to a festive lull and buyers resisting higher import offers.

Physical trade offers no counter-signal. Import scrap prices in India held stable over the past week, but trade stayed stalled and falling local prices remained the better option for mills.

Why it happened

Domestic alternatives keep getting cheaper. Delivered HMS 80:20 scrap in Mandi Gobindgarh fell INR 800/t to INR 36,300/t in the week to 6 November, and melting scrap at Alang dropped by the same amount to INR 37,200/t.

Sponge iron, the main alternative feed for India's induction furnaces, is plentiful and easing. PDRI in Bellary slipped INR 100/t to INR 28,700/t, or about US$305/t. Abundant sponge iron and weak finished steel demand kept the import market quiet.

Finished steel is not helping either. Jalna rebar fell INR 500/t to INR 49,500/t and Raipur billet slipped INR 200/t to INR 42,500/t, while Mumbai rebar eased INR 200/t to INR 51,900/t, as buyers purchased only for immediate needs ahead of Diwali.

At current conversion rates, delivered Mandi HMS at INR 36,300/t is worth roughly US$386/t, already below the CFR import benchmark before port handling and inland freight are added.

The festival itself froze activity, with Diwali curbing buying. Mills are also contending with financing constraints and continue to resist higher supplier offers.

How it plays out

India's weakness stands out because the rest of the seaborne market is firmer. The CFR Turkey benchmark closed at US$411/t on 5 November, US$21/t above India, and some US domestic markets settled US$20-30 per gross ton higher for November.

That gap matters to exporters. Sellers in the UK, US and Middle East can earn more by shipping to Turkey or holding material at home, so they have little reason to chase Indian bids lower. Offers to India are therefore likely to stay sticky even while trade stays thin.

The winners are Indian mills with access to cheap sponge iron and local scrap, which can keep melt costs low. The losers are container exporters who count on India as an outlet, and traders holding cargoes bought at higher October prices.

The post-Diwali restart is the real test. If construction activity picks up, mills may need to restock and imported scrap could find a floor around US$390/t. If rebar keeps falling, buyers will lean even harder on domestic material.

Next week, watch whether finished steel prices steady after the holidays, the direction of local scrap and sponge iron in Mandi Gobindgarh and Bellary, and whether Turkey's softening after the Habas blast drags global offers toward Indian bids.