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

Bangladeshi mills actively sought ferrous scrap trades as domestic steel prices showed signs of recovery. Amid expectations of healthy finished steel demand in the ongoing peak construction season, mills resumed restocking of ferrous scrap buying both containers and bulk cargoes. Sentiments were also driven by a jump in steel and raw material prices in China and Japan. Iron ore prices hit an 11-year high surpassing $175/mt cfr China for 62pc Fe content as mills resumed spot bulk iron ore purchases post-holidays.


Japanese sellers were bullish with Tokyo Steel announcing successive price hikes. For buyers in Bangladesh and Vietnam, offers for Japanese scrap rose by over $35-40/mt in a week.


The Davis Index for containerized shredded, Friday, settled at $467.5/mt cfr Chattogram, up by $43.75/mt from Feb 12. UK/EU-origin containerized shredded traded at $465-470/mt cfr Chattogram. With some offers at even higher levels. Mills might opt for bulk purchases amid elevated container freight charges and limited availability of containers.


Brazilian sellers have resumed exports to Bangladesh on higher bids. The daily Davis Index for US-origin containerized HMS 1&2 (80:20) Friday settled at $436.25/mt cfr Chattogram, up by $2.19/mt; while the index for the grade from Latin America settled at $430/mt cfr Chattogram, up by $2/mt. Offers for the HMS 1&2 (90:10) at $435-440/mt cfr Chattogram.


UK yards stayed away from negotiations amid COVID-19-related lockdown. Freight charges remained elevated despite a marginal drop of $5/mt. Freight cost between the UK to Bangladesh route is at $85/mt compared to $20/mt for the UK to Turkey bulk route, said traders.


Increased demand and prices for Indian pellets in the export market pushed Sponge iron export offers to $380-385/mt cpt Benapole or $390-395/mt cfr Chattogram. 


Trades for containerized P&S and #1 busheling were sporadic with prices moving up. The index for P&S settled at $470/mt, up by $42/mt; while that for #1 busheling was at $485/mt cfr Chattogram, up by $35/mt on Friday.


Domestic steel prices trend up

The weekly index for ship scrap equivalent to P&S rose by BDT1,250/mt ($15/mt) to BDT41,500/mt ($490/mt) ex-works. The index for domestic HMS 1&2 (80:20) rose BDT1250/mt to BDT40,000/mt ex-yard Chattogram. On Friday, yards offered domestic ship scrap at BDT42,000-42,500/mt delivered mills.


Improved vessel cutting rates could ease the shortage of domestic scrap in the coming days. For shipbreakers, offers for vessels were in the range of $430-440/ldt, up by $20/ldt from the prior week. 


Domestic billet traded at BDT52,000-53,000/mt ex-works Chattogram, with its index rising BDT2,000/mt from the prior week. The index for large steelmakers’ rebar, Friday, rose BDT500/mt to BDT65,500/mt ex-works. Mills cancelled discounts amid rising imported scrap prices and intend to hike steel prices in the coming days. 


The index for rebar from medium-scale mills in Dhaka rose BDT2750/mt to BDT61,750/mt ex-works. Small-scale mills offered rebar above BDT56,000-57,000/mt ex-works. Prices of domestic scrap and billet have risen, which could prompt rebar makers to announce price hikes in the coming days.



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