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

Bangladeshi ferrous scrap prices jumped to 28-month high rising by $15-20/mt by this week following strong global cues. Many mills rushed to secure domestic scrap which lifted prices sharply. 


High input costs forced medium and small-scale steelmakers to raise rebar offers, while domestic billet prices jumped $45-50/mt in the last 10 days. Mill operators are relieved that the possibility of a lockdown to control the second wave of COVID-19 pandemic is ruled out amid news of vaccine availability by mid-Jan.


In other bulk markets, offers for US West Coast-origin HMS 1&2 (80:20) were indicated to be above $375-380/mt cfr Chattogram with no firm offers and buying interest as well. Japanese #2 HMS offered at $365/mt cfr Chattogram with no major trades to report.


The weekly Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $365.45/mt cfr Chattogram, up by $2.95/mt from Thursday and up $16.95/mt from a week earlier. A few offers were upto $365-370/mt cfr Chattogram from Australia and the US, differing by quality. Some mills are avoiding imports from the US and UK due to delays in shipment amid tight vessel space. A few HMS 1&2 (80:20) trades reported at $363-365/mt cfr Chattogram in containers.  


The daily index for Latin America-origin HMS 1&2 (80:20) settled at $363/mt cfr Chattogram, up by $3/mt from Thursday, while gaining $22/mt from Nov 20. Offers for Latin American mix HMS #1 and P&S rose to $370-375/mt cfr Chattogram, while a few containers were booked for the grade at $360-365/mt cfr Chattogram from Australia, New Zealand and Chile-origin. Domestic markets in Latin America are firming up amid a recovery in steel demand.


The daily Davis Index for containerized shredded, Friday, settled at $385.71/mt cfr Chattogram, up by $21.07/mt from prior Friday and $3.52/mt from Thursday. Offers rose to a 28-month high. Earlier this week, UK origin shredded traded at $370-375/mt cfr Chattogram but with surging bulk prices in Turkey and tightening supplies, offers increased to $385-390/mt cfr Chattogram. The US and Australian suppliers are offering shredded at around $385/mt cfr Chattogram. 


The weekly Davis Index for busheling settled at $400/mt cfr Chattogram, up by $22/mt from the prior week. Early this week, Blue steel from Australia and the UK traded at $385-390/mt cfr Chattogram, subsequently, offers from the UK yards were at $400-405/mt cfr Chattogram on Friday. P&S scrap from the UK offered at above $385/mt cfr Chattogram with the index rising $21/mt from November 20, but no buyers responded to those levels. P&S from Australia traded up by $10/mt at $380/mt cfr Chattogram.


Billets prices soar

Following high input costs, the weekly Davis Index for domestic billet Friday jumped by BDT4,000/mt to BDT46,500/mt ($549/mt) ex-works Chattogram with trades at the index price. Major steelmakers in Chattogram on Friday offered domestic billet at BDT46,000-47,000/mt ex-works. Steelmakers cancelled discounts on most products.


The weekly Davis Index for rebar from medium-scale steelmakers settled at BDT54,500/mt ex-works, up BDT2,500/mt, inclusive of VAT. Large scale rebar makers like AKS and BSRM have held rebar prices largely stable at BDT56,500-57,500/mt ex-works to encourage sales amid weak demand. These mills are attempting to hike the price by BDT2,000/mt in the coming week. The index for large steelmakers’ rebar settled unchanged from last Friday at BDT57,000/mt ex-works. Also, the gap between medium-scale rebar producers and large-scale producers narrowed to BDT2,500/mt compared to the usual BDT5,000/mt.


Small scale rebar makers offered rebars at BDT50,500-51,000/mt ex-works on subdued infra projects in the rural areas. Amid cash crunch, these mills could announce production cuts to balance the supply-demand mismatch.


Domestic and shipbreaking scrap

Domestic shipbreaking scrap equivalent to P&S rose BDT2,700-3,000/mt to BDT36,500-36,800/mt ex-yards Chattogram from last week following a sharp rise in imported prices. The weekly index rose BDT3,000/mt to BDT36,625/mt ex-yards on Friday. HMS 1&2 (80:20) was priced at BDT35,000-35,500/mt ex-yards Chattogram. The weekly Davis Index for the grade settled at BDT35,250/mt ex-yards on Friday, up BDT2,750/mt. Offers for scrapped vessel imports prices rose to $380-390/ldt amid delays in arrival due to seasonal concerns. Prices are expected to rise further with the two-month cartel system coming to an end in the prior.


($1= BDT84.68)

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