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

Imported ferrous scrap prices rose in Asia following bullish global cues amid supply constraints and rising freight. Many sellers believe prices could go up further before the Ramadan holidays as mills in Malaysia, Indonesia, and other countries restock inventory.



The daily Davis Index for US-origin containerized HMS 1&2 (80:20), Thursday, rose $5/mt to $408/mt cfr Taiwan with bids rising to $400-405/mt cfr and offers rising to $410-415/mt. Deals were heard at $400-405/mt on Thursday. US-based exporters are expected to raise offers further on container shortage and rise in freight rates. The index rose by $17/mt from the prior Thursday (March 25).


Few Taiwanese mills bid for Japanese HMS 1&2 (50:50) at $425-430/mt cfr Taiwan while offers were at $435/mt cfr. Traders said most mills are yet to raise bid and are cautious of rising scrap prices in the international markets.


On a weekly basis, the Davis Indexes for containerized #1 HMS, shredded, P&S 5ft and #1 busheling rose by $18/mt, $15/mt, $17/mt and $17/mt to $415/mt, $421/mt, $435/mt and $445/mt, respectively, from March 25. 


Mills are cautiously watching Turkish and Chinese buying trends. Traders anticipate a $10/mt cfr rise next week.



Vietnamese mills limited containerised scrap purchases and preferred to buy bulk from Japan amid a shortage of empty shipping containers. Mills are cautiously checking Chinese and Turkish purchases ahead of Ramadan. Turkish index for HMS 1&2 (80:20) has been volatile this week. On Tuesday, prices fell by $3.6/mt from Monday, while they rebound by $3.75/mt on Wednesday. On a weekly basis, the index rose by $6.99/mt to $426.99/mt cfr Turkey on Thursday.


In the containers market, the weekly index for US-origin HMS 1&2 (80:20), Thursday, rose by $18/mt at $416/mt cfr Vietnam from the prior week. Mills bids were at $410/mt, while offers are expected to further rise to $430/mt cfr in TEU’s containers as per traders due to the rise in freight prices and global cues. Vietnamese mills are anticipating a rise in demand for HRC and rebars in the export markets and may increase the purchase of ferrous scrap, said market participants.


On a weekly basis, the Davis Indexes for containerized #1 HMS, shredded, P&S 5ft and #1 busheling rose by $21/mt, $22/mt, $15/mt and $17/mt to $424/mt, $435/mt, $440/mt and $450/mt, respectively, from March 25.


In small bulks, trades for Japanese #2 HMS concluded at $445/mt cfr, up $10/mt cfr from the prior week while offers heard at $450-455/mt cfr on Thursday.



The Davis Index for HMS 1&2 (80:20) settled at $430/mt cfr Jakarta, up $25/mt from the week prior with offers rising to $435/mt cfr on Thursday. Limited deals heard at $420-425/mt cfr this week with bids still catching up.


Indonesian mills raised offers on global cues and rising demand for finished steel in the domestic market. Traders indicated that a rise in demand is also due to depleting inventory and a shortage of domestic scrap. Bids kept chasing offers but limited deals were heard this week. Mills are expected to increase purchases ahead of the Ramadan holidays.


Unavailability of containers at USWC and rising freight is expected to increase offers, said market participants. Mills are closely watching Chinese billet and scrap purchases. They anticipate a rise in demand for scrap on positive Chinese futures for raw material and steel.


The weekly indexes for P&S 5ft and shredded rose by $25/mt and $22/mt to $450/mt cfr and $440/mt cfr Jakarta, respectively. Offers for Australia and the UK origin P&S 5ft rose by $20-25/mt to $455-460/mt cfr, while bids were at $450/mt cfr. 


The weekly Davis Index for #1 busheling rose $28/mt to $463/mt cfr Jakarta with offers rising to $470/mt cfr. There is a shortage of premium grades amid stalled auto production. Automakers have announced production cuts due to a shortage of semiconductors, globally. On Thursday, bids for domestic busheling heard at $456/mt delivered Jakarta mill, up $20-25/mt from the prior week.

Imports from Malaysia remained paused amid the announcement of a 15pc export duty on ferrous scrap.

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