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Ferrous market update: December 28-31

Ferrous Market Update 12/31/2020

 

Turkey

  • The daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) remained unchanged on Thursday with the market breaking for the holidays. 
  • Turkish mills are expected to be active early next week and inquiries for cargoes from Asian countries are also rising. 
  • Market participants expect the first two weeks of 2021 to be hectic as mills book supply for February and March.

 

Turkey domestic

  • The weekly Davis Index for DKP scrap (equivalent to auto bundles) in Turkey increased by TRY87/mt ($12/mt) delivered on Monday as most mills raised their purchase prices in the previous week. However, some mills began decreasing prices on Dec 28. ($1 = TRY7.46)
  • Purchase prices for shipbreaking scrap in the Izmir region rose by $25/mt delivered as some producers preferred buying high-quality material from the domestic market instead of imported scrap.

 

CIS

  • The weekly Davis Index for A3 scrap fob Baltic Sea and Black Sea increased by $7/mt and $11/mt, respectively, on Monday.
  • Negotiations with Turkish importers were paused after most buyers stepped back. However, last week, a supplier from Rostov-on-Don closed a deal at $470/mt cfr Turkey for A3 material, while another exporter reached an agreement at $462/mt cfr Turkey for the same grade for prompt shipment.
  • Prices in the Baltic Sea and Black Sea regions have soared by $177/mt fob and $171/mt fob, respectively, over the past two months.
  • Opinions vary about further price direction in the export market. Some suppliers expect the uptrend to continue after the New Year holidays, but others project a potential downward correction after such a huge surge.
  • The weekly Davis Index for A3 scrap increased by RUB325/mt ($4/mt) delivered St Petersburg dock on Monday and fell by RUB1,500/mt ($20/mt) delivered Rostov-on-Don dock. ($1=RUB73.75)

 

Europe

  • The weekly Davis Index for HMS 1&2 (75:25) in the ARAG region increased by €10/mt ($12/mt) delivered dockside on Tuesday based on bookings made ahead of the Christmas holidays.
  • Most Dutch and Belgian recyclers from Amsterdam, Rotterdam, Antwerp, Ghent (ARAG) opted to hold off on the collection of ferrous scrap since Turkish importers have paused purchases. European suppliers prefer to wait and see where prices will move in the next sale to Turkey.
  • No sales have been reported from the region to Turkey since the beginning of last week when HMS 1&2 (80:20) was booked at $455/mt cfr in a mixed composition cargo.
  • The weekly Davis Indexes for HMS 1 and bonus scrap also rose by €10/mt ($12/mt) delivered ARAG docks and €348/mt delivered, respectively, on Tuesday. (€1=$1.23)

 

UK dockside

  • Davis Index’s weekly north and south UK HMS 1&2 (80:20) ferrous scrap indices delivered dockside remained unchanged on Tuesday.
  • With almost all UK docks closed for the Christmas and New Year holidays, ferrous scrap purchase prices remained flat over the past week.
  • Davis Index understands that most dockside buyers will return to work from Jan 4 at the earliest, though it might be days before new deals are concluded.
  • Prior to the break, some UK bulk exporters said they were suffering from reduced merchant supply volumes though many others noted healthy inflows at current prices.
  • The weekly indexes for north and south UK OA (Plate & Structural) were also untouched over the same period.
  • Davis’ north and south UK 5A/5C (frag feed) ferrous scrap indices also remained unchanged over the past week. (£1 = $1.35)

 

Spain

  • Davis Index’s weekly northern Spain HMS 1&2 (80:20) and shredded small bulk ferrous scrap indices were unchanged on Thursday as most Spanish buyers were out of the market for the holidays.
  • No business was heard, conducted, or concluded by suppliers in the UK or European Union (EU) over the same period as well.
  • Davis Index’ UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded were also unchanged compared with the prior week on Dec 31. (€1 = $1.23)

 

US dockside

  • US East Coast ferrous scrap dock collection prices pushed up again amid strong exports, healthy domestic scrap sentiment and limited material availability. Dock prices for most grades, barring shredder feed, remained rangebound in Houston due to a lull in holiday activity.
  • Market participants expect further significant price hikes over the next few weeks as export destinations will pick up the pace entering the New Year, to secure cargoes needed for February shipment. 
  • January domestic scrap trading is also projected to emulate the gains of $60/gt and up witnessed in December. However, ample tonnage was sold last month, and supply has not been replenished to preferred volumes yet. Some sellers expressed interest in receiving the benefit of expected price increases and are making efforts to boost flows. 
  • Export yard buying prices for #1 HMS on the East Coast averaged around $350/gt for local tons on Tuesday, rising by about $20-25/gt since last week and catching up with the larger export price movements since early December. 
  • Pricing for #1 HMS encompasses a full range of $335-395/gt at some East Coast dock locations. Deals closer to $360/gt and higher are for smaller orders and from remote sources. Sellers to the docks are receiving close to $90/gt more for material this week compared to December’s start.
  • Export prices to Turkey from the US for HMS 1&2 (80:20) are leveling off due to the holidays, with small increases during the past week. Prices to the destination are up $46/mt from Dec 15 and have increased by about $113/mt since Dec 1.
  • In Boston, the weekly Davis Index for export yard #1 HMS climbed by $22/gt and P&S 5ft jumped by $23/gt delivered Boston dock. Shredder feed rose by $17/gt delivered. 
  • The weekly Davis Index for export yard buying prices in New York rose by $25/gt delivered for #1 HMS and P&S 5 ft, respectively. The index for shredder feed increased by $11/gt delivered. 
  • In Philadelphia, the Davis Index for #1 HMS increased by $28/gt delivered while P&S 5ft rose by $27/gt delivered Philadelphia dock. Shredder feed climbed by $14/gt delivered.
  • In Houston, the weekly Davis Index trended flat for #1 HMS and P&S 5ft delivered Houston dock. The shredder feed index increased by $20/gt delivered amid elevated feedstock buying for processing ahead of higher prices for finished material.
  • On the West Coast, dock prices in Portland and San Francisco were rangebound but increased in Los Angeles. Officially Los Angeles dock prices remained unchanged but quiet deals seeking to attract tonnage increased them by $5-10/gt.
  • Market participants continue noting limited scrap inventories in most domestic markets, strong mill production plans, and demand for imported scrap. Some dock prices in the EU and other locations increased slightly this week but many exporters suspended collection activity due to the holidays and hoping to time their price movements with those in Turkey in the first two weeks in January. 
  • US bulk sellers continue providing limiting offers to Turkey given bulk interest to other destinations such as Mexico, South America, and Asia at strong prices. Moreover, the expectation of a strong surge in January’s US domestic scrap trade may lead to a further hike in export prices. 
  • Domestic scrap prices continue increasing in South Korea, Taiwan, Vietnam, Malaysia, India, Bangladesh, Pakistan, and other buying regions. Semi-finished and finished steel prices are also rising to support raw materials price increases. South Korean mills could make bulk buys but have been unable to book Japanese deals yet given the upward movement in pricing. The low availability of containers may spur higher interest in small and medium bulk deals.
  • Portland’s weekly Davis Indexes were mostly rangebound with #1 HMS and P&S 5ft rising by $2/gt delivered, respectively. The index for shredder feed was flat.
  • The San Francisco Davis Indexes for all grades were unchanged this week with limited activity due to the holidays. 
  • The weekly Davis Indexes for dock prices in Los Angeles climbed with #1 HMS increasing by $11/gt delivered, P&S 5ft climbing by $12/gt delivered, and shredder feed rising by $15/gt delivered. Los Angeles dock indexes continue surpassing those in Portland and San Francisco after lagging previously. Demand for scrap continues along with limited scrap inflows. 

 

US containers

  • US containerized scrap prices trended up for the 12th consecutive week on the West Coast and regained traction on the East Coast on Thursday. 
  • The news that China will allow ferrous scrap imports beginning January 1, 2021, along with active inquiries from Chinese mills has bolstered the market, despite a slowdown in the Turkish imported scrap market this week.
  • Last week, resistance from East Coast buyers pushed prices down as some sellers sought to capture the financial gain prior to the year-end financial closings. This week, most scrap buyers remained on the sidelines due to the holidays but some accepted higher prices. 
  • Buyers have argued that finished steel consumers are unwilling to accept the continuous upcharge based on higher input prices and softening iron ore prices, but sellers point to limited supplies in a high demand period along with fluctuating but strong prices in iron ore as well as high pig iron prices for the increases. 
  • Offers for containerized scrap have remained firm in the US as the year ends, despite buyer resistance or silence. The same trend was evident in the UAE, Central America, Australia, Russia, and the EU. 
  • The weekly Davis Indexes in New York increased by $23/mt fas for #1 busheling, by $25/mt fas for HMS 1&2 (80:20) by $11/mt fas for machine shop turnings, and by $24/mt fas for both P&S 5ft and shredded. 
  • The indexes in Los Angeles climbed by $24/mt fas for #1 busheling by $16/mt fas for HMS 1&2 (80:20) , by $14/mt fas for P&S 5ft and by $13/mt fas for shredded.
  • Container availability and higher freight charges remain a concern for buyers and sellers on the West Coast. Tight scrap suppliers and feedstock, despite higher scale prices, continue though some market participants withdrew from the market until early January anticipating higher prices. 
  • In San Francisco, the index climbed by $27/mt fas for #1busheling by $15/mt fas for HMS 1&2 (80:20), by $19/mt fas for P&S 5ft, and by $22/mt fas for shredded. 
  • The Davis Indexes in Seattle for #1 busheling and HMS 1&2 (80:20) increased by $12/mt fas. The index for P&S 5ft and shredded rose by $11/mt and $10/mt fas, respectively.
  • Market participants expect steel and scrap to continue strong through Q1 2021 on robust demand for finished steel and long lead times in the US and EU domestic markets.
  • US rebar prices and hot-rolled coil (HRC) prices continue firming up in defiance of previous expectations to flatten. 
  • Finished steel prices have also climbed throughout Asia and in Brazil and Turkish finished steel prices are stable after recent hikes reflecting higher raw material prices. 
  • Markets in Asia for HRC are flat as they wait for cues once business resumes after the holidays. In some Asian markets, HRC and other finished steel goods prices are beginning to flatten or soften. 

 

Mexico

  • Mexico’s domestic ferrous scrap prices increased further in the North and Central regions amid a continuing trend of robust demand and limited supply.
  • Scrap prices across all grades are expected to rise by $50/mt on January 6, 2021, as mills continue their quest to collect material to meet strengthening demand from the automotive and white goods sectors.
  • In the Central region, scrap prices have increased by $5-10/mt as mills continue to struggle with material collections. This issue should get resolved by the end of next month when at least seven vessels are slated to arrive from the US to Veracruz port with shredded scrap at $500/mt cfr. This is in addition to the 12 vessels that arrived from the US to Mexico in December to meet mill demand.
  • The January shipment is expected to meet the scrap demand of a longs and flat steelmaker as well as a pipe producer according to market participants.
  • In North Mexico, the weekly Davis Indexes for #1 HMS, shredded, and machine shop turnings rose by MXN200/mt delivered, respectively. The index for P&S 5ft and #1 busheling rose by MXN250/mt and MXN275/mt, respectively.
  • In Central Mexico, the weekly Davis Indexes for #1 HMS, P&S 5ft, and #1 busheling increased by MX150/mt delivered, respectively. The indexes climbed by MXN512/mt delivered for machine shop turnings and by MXN175/mt delivered for shredded.
  • The weekly Davis Indexes in Bajío for #1 HMS and P&S 5ft increased by MXN200/mt delivered, respectively. The index for shredded was flat and fell for #1 busheling and machine shop turnings by MXN450/mt and MXN75/mt delivered, respectively. ($1=MXN19.95)

 

Japan  

  • Tokyo Steel hiked ferrous scrap price for the tenth time in December on Dec 26. Purchase prices rose by JPY1,000/mt ($9.6/mt) for Tahara plant and JPY2000/mt for Kyushu, Utsunomiya, and Takamatsu. Bids for ferrous scrap deliveries to the Okayama plant were unchanged. 
  • Mill could increase finished steel prices by JPY10,000/mt ($96.6/mt) for January sales.
  • Domestic and export ferrous scrap prices in Japan were flat to up this week as offers were limited due to the holidays. 
  • With no Turkish ferrous scrap deals heard this week many Asian buyers resisted rising offers. Traders expect bids to fall. Market participants indicated that softening iron ore prices in China and a fall in HRC prices could have a bearing on ferrous scrap prices. With the Japanese New Year Holidays extending until Jan 5, most exporters have limited offers. 
  • The weekly Davis Index for Japanese #2 HMS was flat on fas and fob basis. 
  • The weekly index for Japanese #1 busheling (Shindachi) increased by JPY750/mt fas and up by JPY500/mt fob Japan. Offers for the grade rose on limited supply. No deals were heard as importers found offers unviable.
  • China plans to repeal the 2pc import duty on ferrous scrap and revive its most-favored-nation (MFN) system from Jan 1. Japan and Russia stand to benefit from the MFN status. This could lead to a surge in exports from Japan supporting prices in January.
  • In the Kanto region, the Davis Index for #1 HMS fas was flat from the prior week. The index for the grade rose by JPY125/mt fob Japan.
  • The weekly Davis Index for HS and shredded grade rose by JPY625/mt and JPY125/mt fas, respectively, amid limited supply and in sync with the increase in #1 busheling prices.
  • The index for HMS 1&2 (50:50) was flat cfr Taiwan. No offers were active while importers lowered bids as they found current import prices unworkable. ($1=JPY103)

 

South Korea  

  • Lower bids by Korean mills pressurized containerized imported ferrous scrap prices. Mills lowered bids in line with falling iron ore prices. Most buyers stayed away from the market amid limited demand for finished steel and holidays. 
  • The weekly Davis Index for containerized HMS 1&2 (80:20), Wednesday, declined by $4/mt cfr, despite firm offers. 
  • The weekly Davis Indexes for P&S 5ft, #1 HMS, and shredded fell by $6/mt, $5/mt, and $5/mt cfr South Korea, respectively. 
  • Unable to gauge the price direction, some South Korean mills were undecided on bid levels. They are, therefore, closely watching Turkish ferrous scrap trends and Japanese domestic offers to assess the scenario. Domestic scrap bids increased this week as Korean mills may buy locally for immediate requirements and wait till the first week of January before booking imported scrap.
  • The Davis Index for domestic Heavy A rose by KRW17,500/mt ($16/mt) delivered Incheon and Pohang, respectively, on Tuesday. 
  • In containers, limited offers for HMS 1&2 (80:20) were heard at $455/mt cfr from Europe, with no deals yet. Steel mills in Korea are cautiously buying containerized scrap and are not keen on negotiating for bulk scrap due to high offer prices. ($1=KRW1,088)

 

Taiwan  

  • Taiwanese mills held back ferrous scrap imports due to the continued rise in offer prices and opted for domestic scrap. Delays in shipments also reduced bookings. 
  • The Davis Index for containerized US-origin HMS 1&2 (80:20) Thursday rose by $2/mt cfr Taiwan from Wednesday but fell by $3/mt from Dec 24 on lowered bids. No deals were heard this week due to holidays. Few offers rose to $450/mt cfr. Many small mills held bids at $420/mt cfr.
  • On Monday, Feng Hsin Steel raised rebar and ferrous scrap prices by TWD900/mt ($32/mt) ex-works and TWD600/mt delivered mill, respectively. The weekly Davis Indexes for domestic HMS 1&2 (80:20), Tuesday, rose by TWD600/mt delivered South Taiwan and North Taiwan mills, respectively. 
  • High offers in containers are not workable for many mills. Buyers lowered bids this week. With no Turkish buying this week and a correction in Chinese iron ore prices, traders are waiting to see how the market reacts after the holidays. Market participants fear a sudden fall in scrap prices amid limited steel demand.
  • In bulk, no deals were heard this week. Taiwanese mills are cautiously following Turkish buying. 
  • The weekly Davis Indexes for containerized P&S 5ft, #1 HMS, shredded and #1 busheling was flat on Thursday. 
  • US-based yards offered HMS 1&2 (80:20) in FEUs at $450/mt cfr for late January shipment. Traders indicated that container shortage and delays in shipments have slowed purchases. Many mills are finding current offers unviable. ($1=TWD28)

 

China

  • In China, Shagang Steel raised ferrous scrap prices by CNY75/mt ($11/mt) on Tuesday from the prior week. Demand is stable as steelmakers focus on exporting billets, rebars, and HRC. However, raw material prices are firmer compared to semi-finished prices, which fell this week. Iron ore prices fell to $160/mt, on Tuesday from $176.9/mt cfr last week amid volatility.
  • Scrap prices might rise further in January due to increasing demand and scrap shortage in the domestic market. China will start importing ferrous scrap from Jan 1 and many mills are planning to book ferrous scrap shipments from the US, Australia, and Japan.
  • The weekly Davis Index for the HMS 1&2 (80:20) rose by CNY75/mt delivered mill. Deals for P&S 5ft were also heard this week.
  • On Tuesday, prices for Q235 150mm square billets in Tangshan fell by CNY260/mt ex-works including the 13pc VAT from the week prior. HRC export offers fell by $10/mt on Tuesday. Southeast Asian billet export offers were heard at $600-620/mt cfr China this week.
  • Most mills and exporters are awaiting price direction in January before booking scrap. ($1=CNY6.5)

 

Vietnam 

  • The weekly Davis Index for HMS 1&2 (80:20) rose by VND3,00,000/mt ($12.9/mt) this week delivered South Vietnam inclusive of taxes with deals heard around the index price. Vietnamese mills are cautiously negotiating for imported scrap amid a shortage of domestic scrap. Due to the continuous rise in offers, mills are adopting a wait-and-watch approach. 
  • Few deals for HMS 1&2 (90:10) on delivered South Vietnam basis were heard on Tuesday.
  • Japanese suppliers raised offers this week ahead of the holidays. Traders indicated that mills are trying to negotiate at lower prices, but no deals were concluded. 
  • In the containers market, the weekly index for US-origin HMS 1&2 (80:20) Thursday rose by $14/mt cfr from the prior week. Few offers and higher prices from US suppliers led Vietnamese mills to seek containerized scrap from other regions.
  • The weekly index for P&S 5ft and shredded rose by $5/mt and $8/mt cfr, respectively, on Thursday, amid rising offers. Prices for #1 busheling in containers rose $11/mt cfr from a week ago. Offers for P&S 5ft from the US were at $470-475/ mt cfr with no deals heard.
  • In bulk, Japanese #2 HMS and HS offered at $460/mt cfr and $470-490/mt with no deals heard. ($1=VND23,099)

 

Indonesia

  • Indonesian mills were quiet this week amid the approaching exporter registration deadline of Jan 1. Few limited volume deals were heard this week. The market will remain dull till there is clarity on the new scrap import policy.
  • Buyers stayed away from bidding amid bullish offers. The weekly Davis Index for HMS 1&2 (80:20) was flat cfr Jakarta. Offers rose to $440/mt cfr Jakarta on Thursday but no firm bids were heard. With container shortage and rising freight cost, importers expect offers to rise further in January.
  • The index for P&S 5ft was flat cfr Jakarta. Deals were heard this week for Singapore and Hong Kong-origin P&S 5ft cfr Jakarta. The weekly Davis Index for #1 busheling and shredded were flat cfr on Thursday.
  • Traders indicated mills are analyzing Chinese and Turkish scrap buying and finish steel prices before purchasing raw material for January.

 

Thailand

  • The weekly Davis Index for domestic HMS 1&2 (80:20) rose by THB100/mt ($3/mt) delivered Rayong mill inclusive of taxes amid cautious buying by Thai mills. Deals for the grade were heard at the index price. 
  • Deals for P&S 5ft were heard at THB1,200/mt. The imported scrap market remained bullish and a few buyers restocked scrap with material available at the port or domestic yards. 
  • Traders said demand for scrap will remain firm and imported prices could rise further in January, which could lift domestic scrap prices. Due to the holidays, mills have slowed purchases. Higher freight charges and a shortage of containers have forced mills to procure domestic scrap, though tight domestic supply is adding to the price rise this week. ($1=THB30)

 

Malaysia 

  • The weekly indexes for HMS 1&2 (80:20) rose by MYR138/mt and MYR125 ($31/mt) delivered western mills and eastern mills, respectively, inclusive of taxes on global cues. Mills have started raising bids this week, preferring domestic scrap over high-priced imported scrap.
  • Lowering iron ore prices and slow billet demand from China may impact Malaysian mills, who could shift focus to domestic demand. ($1=MYR4)

 

India 

  • Imported ferrous scrap offers to India continued to rise on Thursday but bids lagged offers by $15-20/mt. In December, imported scrap offers rose $90-100/mt in India but trades fell as mills avoided buying at record high prices. 
  • The daily Davis Index for containerized shredded, Thursday, cfr Nhava Sheva rose by $1.25/mt from Wednesday, by $8.12/mt from a week ago, and by $95/mt since Dec 1. Most suppliers went silent citing a possibility of higher prices in January. 
  • Amid strong domestic demand for scrap in Dubai, most suppliers chose to cater to the domestic scrap market. The Davis Index for UAE-origin HMS 1&2 (80:20) cfr Nhava Sheva Thursday rose by $3/mt. Secondary steel producers in India continue to struggle with weak end-user demand while primary steel mills have a positive outlook for the New Year.
  • The Davis Index for US-origin HMS 1&2 (80:20) cfr Nhava Sheva rose by $5/mt from Dec 24 following global cues. Buyers have turned silent and postponed restocking amid firm offers. 
  • In the absence of trades, the indexes for #1 busheling, Turning and P&S scrap moved up by $2-3/mt this week on higher offers.
  • The strengthening Indian rupee against the US dollar could support importers next week.
  • With Iranian billet prices hitting $555/mt fob Iran, Indian mills are eying above $585-590/mt fob India. ($1=Rs73.04)

 

India domestic

  • Ferrous scrap prices in the Indian domestic market continued to trend up. State-owned steelmakers raised finished steel prices for the fifth time early this week. The imported ferrous scrap market also continued to be bullish. These factors led to a rise in prices. 
  • In Mumbai, the Davis Index for HMS 1&2 (80:20) on Thursday, was unchanged from the prior day but up by Rs500/mt del mill from a week ago. In Mandi, it rose by Rs1,700/mt del mill in a week. 
  • Mills believe the market is likely to remain firm for the next 15 days. But fear of the possibility of a crash like in 2008 is making those in the MSME sector tread with caution and adopt a ‘just-in-time’ inventory strategy.

 

Pakistan  

  • Domestic steel prices continued to rise in Pakistan as mills passed on high input costs to consumers. The heavy winter has disrupted logistics in many parts of the country, which is also driving steel prices higher. Prices increased by over PKR12,000/mt ($75/mt) in the last two weeks. Mills with limited inventories are expected to resume trades actively once suppliers return from the New Year holidays. 
  • The daily Davis Index for containerized shredded rose by $0.83/mt from Wednesday and $8.93/mt from prior Thursday. This week, EU/UK-origin containerized shredded traded in thin quantities at $465-470/mt cfr Qasim. Most suppliers and shipping lines have shut operations. Loading activities will reopen on Jan 4. The spread of a new strain of COVID-19 in Europe and limited cash flows stopped some steelmakers from booking raw material despite depleting inventories. 
  • The Davis Index for UAE-origin HMS 1&2 (80:20) cfr Port Qasim rose by $4/mt from prior Tuesday. Dubai yards were targeting higher in absence of other major suppliers. The weekly Davis Indexes for P&S 5ft and #1 busheling rose by $5/mt and $6/mt, respectively. 
  • Domestic billet prices surged by $75-80/mt in the last two weeks driven by high imported scrap prices. On Thursday, the weekly index for domestic Bala billet increased by PKR6,375/mt ex-works. The Davis Index for G-60 billet ex-works Punjab rose by PKR6,500/mt from Dec 24. 
  • All major rebar makers Amreli, ASG steel, and Agha steel have hiked prices citing high ferrous scrap prices in the international market. The weekly Davis Index for rebar rose by PKR7,500/mt ex-works Karachi and by PKR5,000/mt ex-works Punjab despite slow sales at these levels. A major mill was heard to have lifted rebar asking rates to PKR134,500-135,500/mt for 12-32mm rebar. 
  • The weekly index for Art Q toke scrap Thursday surged by PKR7,250/mt ($45.31/mt) ex-yard Lahore and for Pure Q Toke (shredded) by PKR7,000/mt ex-yards amid rising demand and lower availability. ($1=PKR160.12)

 

Bangladesh

  • Bangladeshi steel mills are in urgent need of imported ferrous scrap amid low inventory and tight domestic supply. Yet, most mills delayed buying at record high prices preferring to wait until prices cool-off. 
  • The daily Davis Index for containerized shredded, Thursday, cfr Chattogram, rose by $0.04/mt from Wednesday. Trades for shredded scrap have paused but amid scarce offers, the index for the grade moved up $5.58/mt from a week earlier. A few traders with stocks in hand were keen to sell-off before prices lose steam amid slowing Chinese demand. Most sellers anticipate a strong January market in the US mirroring hikes seen this month. 
  • The Davis Index for containerized HMS 1&2 (80:20) US-origin and Latin America-origin cfr Chattogram, rose by $8.1/mt and $9/mt, respectively, from the prior Thursday. Weekly indexes for #1 busheling and P&S on Thursday, rose $5/mt and $10/mt cfr Chattogram, respectively. 
  • In the bulk market, there were no offers from Japan and Australia on account of holidays and optimism around the resumption of Chinese scrap buying in 2021. Few US bulk offers were active, but bids lagged offers by $10-15/mt. Lockdown in Europe due to COVID-19 and a shortage of containers could hike freight costs to Bangladesh, resulting in overall high landing costs. 
  • Domestic steel prices remained firm this week following global cues. Tight supply and increase in input costs supported higher prices for finished steel. 
  • The weekly index for ship scrap equivalent to P&S and HMS 1&2 (80:20) jumped BDT1,500/mt ex-works. 
  • The weekly Davis Index for domestic billet, Thursday, gained by BDT2,250/mt ex-works Chattogram. The weekly index for large steelmakers’ rebar rose BDT750/mt ex-works. Large mills targeted at around BDT70,000/mt ex-works for rebar to pass-on high input costs. 
  • In the shipbreaking market, despite rising vessel supply, offers were flat as yards are yet to increase booking volumes. Shipbreakers are expected to be active soon as they are short on inventory. ($1= BDT84.68)

 

Metallics

 

CIS 

  • The weekly pig iron Davis Indexes were unchanged on Thursday following a quiet holiday week. 
  • No new deals were confirmed in the market after last week’s sale at $557-570/mt cfr New Orleans. For US mills booking material off these cargoes, final delivered mill prices have now breached $600/mt once logistics and inland transportation costs are factored in.
  • The Davis Index for basic pig iron fob Black Sea, cif Italy, and fob Brazil all remained unchanged.

 

US

  • The weekly Davis Index for basic pig iron (BPI) remained unchanged at New Orleans port on Thursday as the industry takes a break during the holidays.
  • Multiple deals from Brazil to the US last week were in the range of $558-570/mt cfr Nola. New activity is projected to resume next week alongside the January domestic scrap trade wherein large price surges are anticipated.
  • BPI prices have soared by more than $110/mt since the beginning of December and about $140/mt since late November with expectations to reach $600/mt cfr Nola soon.
  • The Davis Index for nodular pig iron (NPI) imports is flat. The grade is limited in availability, but the offers heard for NPI have ranged from $580-610/mt cfr Nola for May or other Q2 2021 delivery.
  • The weekly Davis Index for US hot briquetted iron (HBI) imports is unchanged. The price estimation for the material is supported by Venezuelan import price in correlation with domestic HBI levels, presently around $10/gt more than prime scrap grades.

 

India

  • Sponge prices lost steam and were flat as the supply of iron ore eased. Sponge iron prices are also likely to be pressured by falling ore prices in the international market. 
  • In Mandi, after rising by Rs650/mt on Monday, Sponge iron prices have remained unchanged this entire week. In Mumbai, prices declined by Rs150/mt from the prior Thursday. ($1=Rs73.05)

 

India semi-finished and finished steel

  • The daily Davis Index for billet in Mumbai fell by Rs300/mt ($4.1/mt) ex-works from prior Friday as supply outpaced demand. The index for rebar rose by Rs600/mt ($8.21/mt) despite moderate demand amid New Year Holidays.
  • In Raipur, the daily index for billet rose Rs200/mt ($2.73/mt) ex-works from the previous Friday on higher sponge iron prices along with sustained demand from neighboring markets. The daily index for rebar rose by Rs400/mt ($5.47/mt) ex-works.
  • The daily index for ingot in Mandi Gobindgarh increased Rs500/mt ($6.84/mt) from the prior Friday in-line with a rise in local scrap prices.
  • In Chennai, the bi-weekly index for billet rose Rs500/mt on Thursday in-line with a rise in rebar prices. The bi-weekly index for rebar was up Rs500/mt.
  • The bi-weekly index for billet in Kutch Thursday surged by Rs2,400/mt ($32.83/mt) from the prior week amid a sudden hike in local scrap prices. 
  • Some steel mills have reported weakness in rebar demand and expect prices to correct in the near term. ($1=Rs73.04)

 

Shipbreaking 

  • Shipbreaking prices dropped on Thursday amid weak demand from the re-rollers in Mandi Gobindgarh and Gujarat. Limited trades reported ahead of New Year Holidays. The daily Davis Index for 8ani and 10Ani rose Rs1,850/mt ($25.32/mt) each from the prior week amid tight supply and a rise in imported scrap offers.
  • The daily Davis Indexes for 5kg plates increased Rs1,400/mt from the prior week on Thursday. The Davis Index for HMS attachments and Melting rose by Rs1,000/mt each as mills stocked inventory in anticipation of the further rise in scrap prices.

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