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

Imported ferrous scrap prices in Bangladesh are inching towards the record-high levels seen in January this year, amid strong global cues. However, activity in the market was limited to a few large-scale steel producers and is expected to remain slow next week on account of Eid. In anticipation of increased purchases after Eid and strengthening Chinese cues, prices could surpass the prior peak levels, according to participants. On Friday, no major trade was reported. 

Bangladeshi mills have diverted their oxygen supply for medical use. The government-imposed lockdown restrictions will continue till May 16, keeping logistics slower than usual. 

The daily Davis Index for containerized shredded, Friday, settled at $505/mt cfr Chattogram, up by $1.25/mt. The index rose by $15/mt from prior Thursday. Offers for UK-origin containerized shredded were at $510/mt cfr Chattogram on Friday. Mills shied away from those levels. In early January, shredded prices had reached an all-time high of $510-512/mt cfr Chattogram.

Demand for high-grade scrap was highest in Bangladesh among other subcontinent markets. Tight supply amid semiconductor chip shortage forcing automakers to shut productions and resulted in the limited generation of grades like busheling. 

The Davis indexes for P&S and #1 Busheling, Friday, rose to $515/mt and $532/mt, up by $20/mt and $15/mt, respectively, from the prior Thursday. Trades for Singaporean P&S were at $510/mt cfr Chattogram while UK-origin offers surged to $515-520/mt cfr Chattogram in containers for P&S and busheling traded up to $530/mt cfr Chattogram.


The daily index for HMS 1&2 (80:20) from Latin America settled at $483/mt cfr Chattogram, up by $3/mt. Most Latin American yards kept their offers for HMS 1&2 (80:20) above $480-485/mt cfr Chattogram on higher freight charges and active domestic demand, pushing the index up by $16/mt from prior Thursday.  


Demand for HMS was strengthening in India boosting sellers’ sentiments. Bangladeshi mills have thus raised their bids. Amid tight supply and container shortage globally, the daily indexes for US-origin, UK-origin, and Australia-origin containerized HMS 1&2 (80:20) moved to $484.86/mt, $480/mt, and $487/mt cfr Chattogram, up by $2.36/mt, $3/mt, and $4/mt, respectively. 


Japanese bulk scrap suppliers have returned to the market after the Golden Week holidays that ended on May 5. Bangladeshi mills, despite Eid holidays, may participate in the Kanto tender for May to compete with other East Asian buyers. For shipbreakers, offers for scrapped vessels jumped above $530-540/ldt this week, with buyers refusing to accept these levels now.  

Medium-scale mills have cut production to match weak steel demand and the upcoming monsoon lull. Unable to manage their operations at full scale amid financial challenges and labor shortage, small-scale steelmakers have halted productions.


Domestic steel prices flat 

The weekly index for ship scrap equivalent to P&S was flat at BDT47,500/mt ex-yards on Friday. The index for domestic HMS 1&2 (80:20) was at BDT46,000/mt ex-yard Chattogram, up BDT250/mt. Trades for 16mm ship plates were at BDT54,500-55,000/mt ex-yards.

The weekly index for billet was at BDT61,500/mt ex-works, up BDT750/mt from the prior Thursday. Domestic billet offers inched up amid high input costs at BDT61,000-62,000/mt ex-works Chattogram despite limited trades at BDT59,000-60,000/mt ex-works after discounts. 

Large steelmakers kept offers above BDT70,000-71,000/mt ex-works, keeping the index unchanged at BDT70,500/mt ex-works on Friday. Large mills continued to operate at near-full capacity after managing their workers’ accommodation and safety and thus were interested in scrap procurement as well. 

The index for rebar from medium-scale mills in Dhaka rose by BDT250/mt to BDT67,250/mt ex-works. A few Dhaka-based steel mills raised offers to BDT67,500-68,000/mt ex-works to sync their price with large steelmaker’s offers.



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