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

Bangladeshi steel mills aggressively inquired for ferrous scrap, intending to book material before offers rise any further. Strengthening domestic fundamentals could support trades. Difficulty in sourcing containers and the increased freight rates have increased the landed cost of imported material. The gap between offers to Bangladeshi mills and that for other South Asian buyers stands at $20-25/mt.  


The daily Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $380/mt cfr Chattogram, up by $8/mt. Earlier, trades for containerized HMS 1&2 (80:20) were reported at $375-380/mt cfr Chattogram from Australia and Latin American suppliers. A few containers of Australian HMS 1&2 (80:20) sold at $370-375/mt cfr Chattogram, at prices $5-7/mt above last week’s levels. Some mills were not keen on imports from the US and UK due to shipping delays as suppliers struggled to secure vessel space. Trades for #1 HMS sheared from the UK concluded at $402/mt cfr Chattogram.  


The daily Davis Index for containerized shredded, Wednesday, settled at $400/mt cfr Chattogram, up by $8/mt. Offers for shredded scrap were very limited and in the range at $395-405/mt cfr Chattogram from Australia, Latin America and UK/EU and suppliers. Blue steel was offered at $410/mt cfr Chattogram on Wednesday. The offer levels have reached 29 months peak, since June 2018. A Dhaka-based steelmaker bought 500mt of UK-origin containerized P&S at $415/mt cfr Chattogram, boosting market sentiment. 


Offers from European yards have started dwindling ahead of the winter break. With offers above $400/mt cfr Chattogram levels, buyers were unwilling to negotiate, at least until they could successfully pass on the raw material price hike to end-users.

The daily index for Latin America-origin HMS 1&2 (80:20) settled at $373/mt cfr Chattogram, up by $4/mt. Offers for Latin American mix HMS #1 and P&S at $375-380/mt cfr Chattogram, while buyers were looking for HMS 1&2 (80:20) from Chile at $370/mt cfr Chattogram. Domestic markets in Latin America are bullish due to the recovery in steel demand.  


Trades slowly up for rebar and billets

Trades for domestic billets started picking up on the back of demand recovery. Steel mills were offering domestic billet at BDT48,000-48,500/mt ($566-572/mt) ex-works Chattogram. A few steelmakers in Dhaka even offered billets as high as at BDT49,000/mt ex-works, including local taxes and VAT. Steelmakers canceled discounts on most products.  


Large scale steelmakers like AKS and BSRM raised rebar prices to BDT58,500-60,000/mt ex-works, to pass on the increased raw material costs. Following their suit, medium and small-scale producers hiked rebar prices by BDT2,000-2,500/mt in Bangladesh.  


Domestic and shipbreaking scrap

Domestic shipbreaking scrap equivalent to P&S were at BDT500-1,000/mt from last week to BDT37,500-38,000/mt ex-yards Chattogram. Offers for scrapped vessel imports jumped above $400/ldt, with delays in arrival due to seasonal concerns. Around 20,000mt vessel heard to have concluded at $425/ldt, Pakistani buyers remained competitive paying very high in the market.  


($1= BDT84.68)

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