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

Imported scrap prices in East and Southeast Asian markets rose from the prior week with US-based suppliers raising offer prices despite limited demand. Asian buyers remain wary of buying at higher prices, a shortage of containers and vessel delays are upsetting their inventory plans.



The Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $322/mt cfr, up $5/mt Taiwan from the prior day, while it rose by $8/mt from the prior week (Nov 26). A few deals were heard at $320-325/mt cfr this week. Many small mills held bids at $315-320/mt cfr. 


Feng Hsin raised finished steel prices by TWD200/mt ($7/mt) on Monday. Market participants expect for finished steel and ferrous scrap prices to increase further. Finished steel demand in Taiwan is stable but margins are squeezed. 


US-based yards offered HMS 1&2 (80:20) in FEUs at $330-335/mt cfr. Prices are expected to rise with increased buying by Turkish importers. The Davis Index for US-origin HMS 1&2 (80:20) in Turkey Wednesday rose by $11/mt from Nov 26. Turkey’s index rose by $66/mt in November.


While demand is limited, rising offers are pushing ferrous scrap prices up in Taiwan. Traders indicated that container shortage and delay in shipments have made importers prefer scrap from other origins like Australia and South America. Taiwanese mills focused on domestic scrap to offset rising imported scrap offers.


The weekly Davis Indexes for containerized P&S 5ft, #1 HMS, shredded and #1 busheling rose by $11/mt, $10/mt, $12/mt and $8/mt to $352/mt cfr, $331/mt cfr, $343/mt cfr and $358/mt cfr, respectively. Limited deals were heard for the above grades as mills were wary of rising offers.


Offer for HMS 1&2 (80:20) in TEU from Australia and New Zealand were at $320/mt cfr, while bids were at $310-315/mt cfr. In the bulk market, offers for Japanese HMS 1&2 (50:50) were at $360-365/mt cfr, up by $10-15/mt from the week prior. Offers rose despite limited buying. 



Rise in HRC and rebar sales domestically pushed steel mills to restock ferrous scrap aggressively.


In the containers market, the weekly index for US-origin HMS 1&2 (80:20) settled at $329/mt cfr Vietnam on Thursday, up by $10/mt. As per traders, there is limited supply from the US and offers are expected to rise further next week. 


Vietnamese mills negotiated for Japan and US-origin material in bulk and stayed away from containerised scrap due to container shortage and vessel delays delaying shipments. In the bulk market, deals for Japanese #2 HMS heard at $365/mt cfr Vietnam this week. Offers were at $365/mt cfr on Thursday but no deals heard. 


A bulk deal for Australian HMS 1&2 (80:20) was heard at $372/mt cfr Vietnam on Wednesday, but its yet to be confirmed. 


The weekly index for P&S 5ft and shredded rose by $9/mt and $13/mt to $353/mt cfr and $350/mt cfr, respectively, on Thursday, amid scrap shortage and rising offers. Vietnamese mills were also inquiring for Australian-origin scrap, said traders. Deals were heard for P&S 5ft this week at $352/mt cfr with offers rising in TEU to $360/mt, up by $5-10/mt from the prior week, but no buying heard.


Prices for #1 busheling in containers rose $10/mt to $365/mt cfr from a week ago, and offers of $370/mt cfr in TEU were unacceptable for buyers.



Indonesian mills were quiet this week amid high US-origin offers, delay in shipments and the approaching exporter registration deadline of Jan 1. Many yards stayed away from offering scrap to Indonesia due to the registration norm. They expect limited buying in December. 


The difference between offers and bids in Indonesia stayed around $10/mt cfr. The weekly Davis Index for HMS 1&2 (80:20) rose by $9/mt to $347/mt cfr Jakarta. Offers rose to $355-360/mt cfr Jakarta on Thursday, with bids at $340/mt cfr.


The indexes for P&S 5ft and #1 HMS rose by $10/mt and $9/mt to $366/mt cfr and $354/mt cfr Jakarta, respectively. Deals were heard for Hong Kong origin P&S 5ft was heard at $352/mt cfr on prior Thursday, while no deals heard this week.


The weekly Davis Index for #1 busheling settled up by $16/mt at $376/mt cfr. A deal for the grade from UK-yard was heard at $360/mt on prior Wednesday. With rising offers, mills stayed away from any purchases.


The weekly Davis Index for shredded rose by $9/mt cfr to $360/mt cfr. Rising Chinese demand for billet is expected to push Indonesian mills to buy at higher offers for January shipments next week.



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