Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Imported scrap prices in East and Southeast Asian markets were flat to down from the prior week. With offer prices rising for US-origin scrap and steel mills turned to Japanese and Russian bulk scrap suppliers.   



Rising global markets but weak domestic demand kept import scrap prices in Taiwan under pressure. Trading remained thin this week with rising offers amid limited supply. The Davis Index for containerized US-origin HMS 1&2 (80:20), Thursday, was unchanged at $264/mt cfr Taiwan from the day prior but fell by $9/mt from Oct 1. Bids declined to $260/mt cfr Taiwan, also weighed down by flat domestic scrap prices and an expectation of further fall.


Offers for US-origin HMS 1&2 (80:20) in FEU were at $270/mt and expected to rise further with an uptick in buying from Turkey. Turkey Index for US-origin HMS 1&2 (80:20) rose by $4/mt on Wednesday from October 9.


Finished steel prices in Taiwan were flat this week. Amid pressure on the steel prices, Feng Hsin Steel kept purchase prices for domestic HMS scrap flat. Buyers placed few bids for South American HMS 1&2 (80:20) at $260/mt cfr this week, while offers rose to $265-270/mt.


The weekly Davis Indexes for containerized P&S 5ft, #1HMS rose by $1/mt, to $282/mt cfr, $270/mt cfr on rising offers while bids were left unchanged. The weekly Davis Index for containerized shredded fell by $1/mt to $275/mt cfr on lower bids. No deals were heard for the grade.


In the bulk market, HMS 1&2 (50:50) offers were heard at $290-305/mt. Taiwanese mills were negotiating for bulk ferrous scrap from Japan, but no deals were heard.



In the containers market, the weekly index for US-origin HMS 1&2 (80:20) settled at $270/mt cfr Vietnam on Thursday, down by $3/mt. Offers for the same grade in FEU were at $280/mt cfr. Few deals were heard at the index price. 

With Vietnam concentrating more on purchasing Japanese and Russian bulk scrap, very few containerised deals were heard. Market participants indicated that the major reason for the same is the increase in US-origin containerised scrap prices, while Japanese ferrous scrap export prices fell. Mills are waiting for prices to decline further since the present finished steel price levels are unsupportive for imports. 


Few deals were heard for US origin P&S 5ft in FEU at $295/mt cfr and $290/mt cfr in TEU. The weekly Index for P&S 5ft was down by $2/mt at $288/mt cfr on Thursday.


In the containers market, the weekly indexes for #1 busheling and shredded fell by $4/mt at $294/mt cfr, $280/mt cfr, respectively. 

Vietnamese mills, including Formosa, raised HRC offers by $10-15/mt this week as China bought HRC at $520-530/mt cfr Vietnam and Russia. China halted imports in the latter part of the week due to high inventory and volatility in iron ore and coal prices. Ban on Australian coking coal further aggravated bearish sentiments.


In the bulk market, a deal for #2 HMS from Japan was heard at $300/mt cfr Vietnam. Offers for US-origin HMS 1&2 (80:20) were at $307/mt, while bids were at $300/mt. Offers for HMS 1&2 (50:50) from Hong Kong were at $293-297/mt. Japanese busheling (shindachi) was offered at $332/mt cfr, while bids were at $327/mt cfr. 


Vietnamese mills are exploring the Russian market for lower-priced bulk. A Russian A3 deal to Korea’s Dongkuk Steel was heard at $285/mt cfr. 



Indonesian mills focused on domestic scrap purchases and billet imports this week. News of extension of export registration norm to Jan 1, 2021 boosted offer prices on Thursday. Buyers still await an official announcement from the Indonesian government before making any new bookings for imported ferrous scrap.


Market participants are expecting scrap prices to rise on global cues and an increase in demand due to the extension. 


The weekly Davis Index for HMS 1&2 (80:20) fell by $1/mt to $284/mt cfr Jakarta. A few offers were reported at $285-290/mt cfr Jakarta on Thursday with no buying interest yet. 


The weekly Davis Index for #1 busheling scrap rose by $5/mt to $325/mt cfr Jakarta amid rising offers due to an increase in demand from Turkey and other Asian countries.


The indexes for P&S 5ft and #1 HMS fell by $1/mt and $3/mt to $313/mt cfr and $286/mt cfr Jakarta, respectively. Offers for P&S 5ft from Hong Kong and New Zealand were heard at $315-333/mt cfr and $318/mt cfr, with bids for Hong Kong-origin heard at $310/mt cfr.


Indonesian billet imports would decrease if registration process extension is confirmed, said traders. Traders were offering billets at $450/mt cfr SE Asia made in blast furnaces. No deals were heard for Indonesia this week.

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