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

Bangladesh government announced the extension of COVID-19 related lockdown by another week amid rising COVID-19 infections. Steel production continues despite the limited availability of labourers and disruption of transportation. A few mills with low inventory continued the purchase of ferrous scrap in containers, albeit, in thin volumes. Overall steel demand remains affected due to limited economic activities during Ramadan and expectation of a further slowdown ahead of monsoon season. 


The daily Davis Index for containerized shredded, Wednesday, settled at $490/mt cfr Chattogram, up $2.5/mt from Tuesday. Most offers were at $490-495/mt cfr Chattogram. Offers continued to recover as buyers could not find low-priced material from suppliers. 


A recovery in finished steel demand is expected to boost restocking of ferrous scrap post mid-May as some infrastructure activities pick pace.  


Shortage of containers, tight vessel space and increased freights have led to a significant gap between the landed cost for imported scrap in bulk compared to containerized which has forced mills to opt for bulk purchases. 


In the small bulk market, Japanese #2 HMS offered at $485-490/mt cfr Chattogram while for offers for Busheling heard above $530-535/mt cfr Chattogram. For shipbreakers, offers for scrapped vessels jumped above $520-525/ldt this week, with buyers refusing to accept levels above $500/ldt. 


The index for HMS 1&2 (80:20) from Latin America settled at $467/mt cfr Chattogram, up $3/mt from Tuesday. Most Latin American yards target to sell HMS 1&2 (80:20) at $470-475/mt cfr Chattogram on higher freight charges. The daily indexes for US-origin, UK-origin, and Australia-origin containerized HMS 1&2 (80:20) rose to $468.5/mt, $466/mt, and $473/mt cfr Chattogram, up $1/mt each on Wednesday amid firm offers. 


Domestic steel prices stay firm 

Domestic steel prices have remained stable despite the Ramadan lull. While most medium-scale mills in Dhaka maintained asking rates for rebar at BDT68,500-69,500/mt ex-works. Large steelmakers like AKS, GPH and BSRM held their offers above BDT70,000-71,000/mt ex-works, stable as they continued to operate at near to full capacity after managing their worker’s accommodation and health safety.


Ship scrap equivalent to P&S was firm at BDT48,000-48,500/mt ex-yards. The domestic mixed HMS 1&2 (80:20) and plates scrap traded at BDT45,500/mt ex-yard Chattogram, stable on Wednesday.


Trades for 16mm ship plates were at BDT54,500-55,000/mt ex-yards. Domestic billet offers remained stable amid high input costs at BDT61,500-62,000/mt ex-works Chattogram despite limited trades.



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