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Ferrous market update: December 7-11

Ferrous Market Update 12/11/2020

 

Turkey

  • The daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) rose by $10.31/mt on Friday as sellers refused to accept current bids in anticipation of higher prices.
  • Turkish ferrous scrap importers are actively looking for cargoes and bidding $400-405/mt cfr for HMS 1&2 (80:20) from the USA and the Baltic region, but firm offers are missing. 
  • Sellers are bullish due to tight supply. A few Baltic exporters anticipate next deals at around $420/mt cfr, while US exporters are expected to resume sales to Turkey at $430-440/mt cfr for HMS 1&2 (80:20), considering prices at alternative outlets.
  • Prices for shipbreaking scrap in the Turkish domestic market rose by $20/mt over two days due to solid demand.
  • Turkey’s daily domestic spot rebar prices soared by TRY200-240/mt ($25.50-31/mt) on Friday amid robust sales.
  • The daily exported rebar prices in Turkey jumped to $585-600/mt fob on Friday. A sale of Turkish rebar to Peru was heard at $600/mt fob. Some mills reported offers at $610/mt fob at the end of the week. ($1 = TRY7.83)

 

Turkey domestic

  • The weekly Davis Index for DKP scrap (equivalent to auto bundles) in Turkey soared by TRY251/mt ($32/mt) on Monday amid active buying and a bullish imported ferrous scrap market. ($1 = TRY7.84)

CIS

  • The weekly Davis Index for A3 scrap rose by $12/mt fob Baltic Sea basin and by $18/mt fob Black Sea basin on Monday as buyers in the export market, accepted higher prices.
  • Russian suppliers sold several ferrous scrap cargoes to foreign outlets. Demand for scrap in Turkey exceeds its supply significantly at present because of which, exporters are achieving higher prices with every sale.
  • Collection prices for ferrous scrap increased further in Russia on Monday. The weekly Davis Index for A3 scrap rose by RUB850/mt ($12/mt) delivered St Petersburg dock and by RUB1,150/mt ($16/mt) delivered Rostov-on-Don dock. ($1 = RUB73.47)

 

Europe

  • The weekly Davis Index for HMS 1&2 (75:25) in the ARAG region rose by €11/mt ($13/mt) on Tuesday amid a busy export market and positive sentiment.
  • Collection prices for ferrous scrap increased in the Netherlands and Belgium as suppliers sought tonnages after the most recent transactions in Turkey. (€1 = $1.21)

 

UK dockside

  • Davis Index’s weekly north and south UK HMS 1&2 (80:20) ferrous scrap indices jumped by £10/mt ($13/mt), delivered dockside, on Tuesday.
  • UK ferrous bulk processors have managed to limit dockside purchase price hikes to $40/mt over the past month compared with an almost $80/mt surge in major seaborne trade routes.
  • One major UK-based ferrous scrap trader noted that a modest portion of the seaborne price hikes was comprised of a sharp increase in Handymax freight rates to $26/mt from around $18-20/mt over the past 10 days.
  • Nevertheless, major British scrap exporters’ margins have swelled given that they have still been able to secure sufficient volumes to fill vessels at these levels.
  • British shortsea bulk coasters and transhippers have also benefitted from a healthy arbitrage between the UK and northern European destinations, particularly Amsterdam, Antwerp, and Ghent.
  • The weekly indexes for north and south UK OA (Plate & Structural) increased by £10/mt over the same period, respectively, delivered dockside on Dec 8.
  • Davis’ north and south UK 5A/5C (frag feed) ferrous scrap indexes surged by £15/mt, respectively, delivered dockside over the past week. (£1 = $1.33)

 

Spain

  • Davis Index’s weekly northern Spain HMS 1&2 (80:20) and shredded small bulk ferrous scrap indices surged by €19/mt cfr ($23/mt) and €22/mt cfr, respectively, on Friday.
  • Shortsea bulk ferrous scrap tags were driven higher by stronger UK dockside purchase prices and robust demand from competing shortsea and deep-sea markets.
  • Ravenous ferrous scrap demand has now seen Turkish mills bring purchases forward for February shipment as they buy 60-90 days ahead compared with their traditional 30-day window.
  • This partly contributed to the Turkish HMS 1&2 (80:20) ferrous scrap import index jumping $39/mt over the past week to $399.69/mt on Dec 10.
  • Major UK-based ferrous bulk exporters have recently raised HMS 1&2 (80:20) dockside purchase prices by a further £10/mt to a maximum of £200/mt, delivered to dock.
  • Davis Index’s UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded also climbed by €24/mt and €22/mt fob, respectively, on Dec 11. (€1 = $1.21)

 

US dockside

  • US East Coast and Houston dock collection prices continued to increase as supply tightens amid strong export and domestic market strength.
  • Export yard buying prices for #1 HMS on the East Coast ranged between $270-280/gt on Tuesday, rising by an average of $16-21/gt since last week and by about $30-40/gt since Nov 10. More substantial export yard price increases were expected, and #1 HMS should gradually approach $300/gt or more shortly, which would correlate better with the overall market dynamics.
  • Exports to Turkey from the US were priced at around $380/mt cfr on Tuesday for HMS 1&2 (80:20) compared with $340-345/mt cfr for the material on Nov 24, representing a rise of about $35-40/mt for the grade over the past two weeks and up about $87/mt since late October. 
  • In Boston, the weekly Davis Index for export yard #1 HMS climbed by $18/gt and P&S 5ft jumped by $16/gt delivered Boston dock. Shredder feed rose by $2/gt delivered. 
  • The weekly Davis Index for export yard buying prices in New York rose by $20/gt delivered for #1 HMS and $21/gt delivered dock for P&S 5ft. The index for shredder feed increased by $7/gt delivered. 
  • Price surges were observed in shredder feed last week compared to other grades in response to demand and availability of the material, however, the increases tapered off on Tuesday. 
  • Other materials, such as #1 HMS and P&S 5ft showed modest increases last week as prior orders were still being fulfilled. On Tuesday, higher gains were received on these grades as new, higher-priced deals between the US and Turkey continued.
  • In Philadelphia, the Davis Index for export yard collection prices of #1 HMS increased by $18/gt delivered and P&S 5ft went up by $16/gt delivered Philadelphia dock. Shredder feed rose by $4/gt delivered.  
  • In Houston, the weekly Davis Index climbed by $18/gt for #1 HMS and $14/gt for P&S 5ft delivered Houston dock. The shredder feed index increased by $21/gt delivered.
  • Ferrous scrap dock prices climbed throughout the West Coast supported by a leap in US domestic scrap prices and continued demand from Asian countries. 
  • The limited availability of containerized scrap availability is also prompting buyers to consider bulk vessel prices. Bulk shredded buys are expected to breach $400/mt cfr to Asian destinations. 
  • Tight scrap inventories and flows continue throughout the West Coast. Domestic mills in the Southwest-Texas region are also drawing inventories and Mexican mills are actively pursuing scrap purchases throughout California and the Southwest. 
  • Los Angeles docks began to roll out official price increases of $10/gt last week and followed those up with another $20/gt increase during the week. Effective deal prices have therefore increased substantially as entities compete for scrap flows. In Oregon, docks continued adjusting in early December with frequent $5-10/gt increases as domestic mills raised prices to compete for scrap. 
  • The higher Turkish deals are reverberating throughout the global scrap market with export prices in the US, Japan, Russia, and Latin America firming up. In the US, higher domestic mill prices have forced docks to increase their rates as well. 
  • The weekly Davis Indexes in Portland leaped as US domestic mills competed for inventories with docks. The index for #1 HMS increased by $21/gt delivered and P&S 5ft climbed by $19/gt delivered. The index for shredder feed rose by $12/gt delivered.  
  • The San Francisco Davis Indexes increased aggressively through November and this week HMS #1 rose by $7/gt delivered and P&S 5ft jumped by $12/gt delivered. The index for shredder feed rose by $18/gt delivered. 
  • The Davis Indexes in Los Angeles increased by $19/gt for #1 HMS, P&S 5ft climbed by $22/gt, and shredder feed rose by $3/gt delivered. Prepared grades were sought after due to limited scrap availability. 

 

US containers

  • US containerized scrap prices continued the upsurge that began in October into mid-December. A strong export market supported by hefty increases of over $50-100/gt on US domestic scrap prices is supporting the containers market. 
  • The Davis Index Turkey import scrap level is now close to $400/mt cfr on HMS 1&2 (80:20), up $39/mt against Dec 3. Higher export prices reflect freight increases, rising demand, and higher iron ore prices that are supporting the containers market’s surge, along with rising trends in scrap alternatives such as imported pig iron, domestic HBI, and DRI.
  • Japanese scrap export prices continue increasing to record levels. Export prices in Russian, Baltic, Latin American, and other scrap alternatives are also rising, supporting US export prices amid limited scrap availability and offers on both the East and West Coasts. 
  • On the East Coast, shredded offers by traders were reported at $380-390/mt fas on containers on Thursday. Negotiations are ongoing and concrete deals have not been heard. 
  • Buyers in India have accepted higher import scrap prices to meet production schedules and limited global scrap though domestic scrap prices have trended flat to down depending on the region. Thus, mills may shift attention to domestic scrap. Offers were scarce to Bangladesh and Pakistan with buyers accepting higher import scrap prices.
  • Taiwanese buyers are cautiously purchasing while buyers in Indonesia and Malaysia have adopted a wait and see approach on climbing import offers. Vietnam finishes steel prices have not increased in tandem with higher scrap prices, thereby, limiting purchasing levels for buyers despite the continued demand. 
  • Freights may settle down on the West Coast according to a Taiwan trader, though at around $10/mt higher than the historical levels. 
  •  The weekly Davis Indexes in New York rose by $23/mt fas for #1 busheling and by $13/mt fas for HMS 1&2 (80:20). P&S 5ft and shredded scrap climbed significantly by $33/mt fas. 
  • Machine shop turnings were flat the previous week and have been lagging in weekly increases against the better grades as buyers focus on maximizing loads in a tight container market. The index for machine shop turnings increased by $8/mt fas New York on Thursday.
  • The Davis Indexes in Los Angeles jumped for #1 busheling and shredded by $20/mt fas. HMS 1&2 (80:20) rose by $10/mt fas and P&S 5ft increased by $18/mt fas. 
  • The HMS 1&2 (80:20) index in Los Angeles has climbed by $61/mt fas from early October. Though container availability is tight, sellers continue to make offers in the hopes of obtaining a valid container booking. Overall, both sellers and buyers believe that the situation has not reached extreme levels. 
  • Some scrap sellers are also withdrawing from the market to manage year-end accounts and taxation and are retaining limited inventories in anticipation of a continued boost in prices next month. 
  • The spread between container and dock prices is still great at this time and sellers may not increase volumes towards docks due to tight container availability. Some sellers may consider shifting volumes to docks if containers became more difficult to procure in the coming weeks. 
  •  In San Francisco, the index for #1busheling and P&S 5ft increased by $12/mt fas. HMS 1&2 (80:20) rose by $6/mt fas and shredded climbed by $10/mt fas. 
  • The Davis Indexes in Seattle for #1 busheling increased by $12/mt fas, HMS 1&2 (80:20) rose by $8/mt fas, and P&S 5ft and shredded both rose by $14/mt fas as buyers purchased both at about equal prices.

 

Mexico

  • Mexico’s domestic ferrous scrap prices increased by $5-30/mt depending on the region on Friday amid high demand and tight supply.
  • Scrap prices in the country’s Central and Bajío regions rose by $15/mt across all grades after the import prices for HMS 1&2 (80:20) cfr Turkey breached the $400/mt mark earlier this week.
  • Scrap prices in the northern region also increased as mills continued their struggle to collect material and were willing to pay higher rates to secure volumes. Mills’ demand for scrap could raise prices for some grades to as much as MXN9,000/mt ($448/mt) over the next few weeks.
  • On Friday, scrap prices in North Mexico rose by $10-12/mt and may climb further as one mill in this region continues applying increases of around MXN250/mt to secure supply for December 2020 and January 2021.
  • In North Mexico, the weekly Davis Indexes increased by MXN200/mt delivered Mexico consumer for machine shop turnings, P&S 5ft, shredded, and #1 busheling, while HMS 1&2 (80:20) rose by MXN250/mt delivered.
  • Scrap prices in the Bajío and Central regions climbed between $5-12.40/mt and $15-30/mt, respectively, during the week.
  • The weekly Davis Indexes in Bajío rose by MXN250/mt delivered Mexico consumer, for HMS 1&2 (80:20), MXN225/mt delivered for P&S 5ft, MXN175/mt delivered, for shredded, MXN100/mt delivered for #1 busheling, and MXN250/mt delivered for machine shop turnings.
  • In Central Mexico, the weekly Davis Indexes increased by MXN300/mt delivered Mexico consumer for #1 busheling, HMS 1&2 (80:20), and shredded, respectively. P&S 5ft increased by MXN500/mt delivered, and machine shop turnings climbed by MXN600/mt delivered. ($1=MXN20.09)

 

Japan  

  • In the monthly Kanto tender announced on Thursday, average bids rose by JPY8,105/mt. The rise encouraged Tokyo Steel to raise ferrous scrap prices for the fifth time in December. 
  • Effective Dec 11, Tokyo Steel’s ferrous scrap purchase prices rose by JPY1,500/mt ($14/mt) at Tahara and Utsunomiya plants. At the other three works, they were raised by JPY1,000/mt. 
  • Prices could rise further amid a shortage of scrap and a rise in demand in the domestic and overseas markets.
  • The weekly Davis Index for #2 HMS rose by JPY1,875/mt ($18/mt) fas, and in the export market by JPY1,500/mt fob Japan. 
  • In the Kanto region, the Davis Index for #1 HMS rose by JPY2,000/mt fas and by JPY1,875/mt fob Japan. 
  • The index for Japanese #1 busheling (Shindachi) rose by JPY1,250/mt fas and was up by JPY1,786/mt fob Japan. 
  • The weekly indices for HS and shredded rose by JPY1,750/mt and JPY1,375/mt, respectively. 
  • Offers for HMS 1&2 (50:50) increased by $10-15/mt from the prior week. The index for the grade rose by $14/mt cfr Taiwan. ($1= JPY104)

 

South Korea  

  • Prices for containerized imported ferrous scrap rose amid a global shortage of material, as well as containers. Demand, however, is still under pressure. Mills thus opted for domestic material, prices for which were lower than imported scrap.
  • The weekly Davis Index for containerized HMS 1&2 (80:20), Wednesday, increased by $15/mt cfr, with limited deals heard. 
  • The weekly Davis Indexes for P&S 5ft, #1 HMS, and shredded rose by $11/mt, $15/mt, and $16/mt cfr South Korea, respectively.
  • South American suppliers offered HMS 1&2 (80:20) at prices up by $10-15/mt cfr from the prior week.
  • With firm demand for billets in China, mills in South Korea increased production, hoping to raise exports. Billet export offers from mills in Southeast Asia increased by $10/mt from last week. 
  • The Davis Index for domestic Heavy A, Tuesday, rose by KRW2,500/mt delivered Incheon and Pohang. Smaller mills also hiked bids to increase inventory before mid-December. 
  • A few mills preferred lower-priced Light A scrap. The weekly Davis Index for domestic Light A increased by KRW2500/mt delivered Pohang mill. Suppliers held material expecting a price hike amid rising global ferrous scrap prices. 
  • On Dec 11, Hyundai Steel increased its scrap purchase prices by JPY4,500/mt from the prior week. ($1=KRW1,090)

 

Taiwan  

  • Imported scrap prices in East and Southeast Asian markets rose from the prior week, with US-based suppliers raising offer prices despite limited demand. Asian buyers remain wary of buying at higher prices. A shortage of containers, vessel delays, and the news of a reduction in free days by shipping lines has hit trades. 
  • The daily Davis Index for containerized US-origin HMS 1&2 (80:20) increased by $17/mt on Thursday and by $26/mt from Dec 3. 
  • Feng Hsin raised finished steel and domestic ferrous scrap prices by TWD300/mt ($10.6/mt) on Monday from the prior week. 
  • The weekly Davis Indexes for containerized P&S 5ft, #1 HMS, shredded, and #1 busheling rose by $27/mt, $28/mt, $23/mt, and $28/mt cfr, respectively. ($1=TWD28)

 

China

  • In China, Shagang Steel raised finished steel and ferrous scrap prices by CNY110/mt on Tuesday. Rising steel demand coupled with iron ore prices hitting a seven-year high of $147/mt cfr China, pushed up ferrous scrap prices in the domestic market. 
  • The weekly Davis Index for the HMS 1&2 (80:20) rose by CNY110/mt($16.8/mt) delivered mill. 
  • On Tuesday, prices for Q235 150mm square billets in Tangshan increased by CNY50/mt ex-works including the 13pc VAT. Southeast Asian billet export offers climbed by $20-30/mt fob from the prior week. 
  • There is a lot of ambiguity among market participants around the ban of solid waste imports into China and whether ferrous scrap would be part of it. Steel mills are waiting for further clarity on the policy. But despite a lack of clarity, there were inquiries from Chinese traders for the US and Japanese scrap. ($1=CNY6.5)

 

Vietnam 

  • A rise in HRC and rebar sales encouraged steel mills to ramp up production, but an increase in Japanese and US ferrous scrap offers have forced them to hold back on new scrap bookings. Steel mills in Vietnam have limited purchasing power as finished steel prices have not increased in sync with scrap prices.
  • In the container market, the weekly index for US-origin HMS 1&2 (80:20) increased by $28/mt cfr. There is limited supply from the US and Japan, which could raise offers further next week. 
  • Buyers stayed away from containerized scrap amid container shortages and vessel delays. 
  • The weekly index for P&S 5ft and shredded rose by $28/mt cfr. Vietnamese mills were also inquiring for South American and Australian-origin scrap at lower prices. 
  • Prices for #1 busheling in containers rose $25/mt cfr from a week ago, turning it into an unviable option for most mills. 
  • The weekly Davis Index for HMS 1&2 (80:20) rose by VND4,50,000/mt ($19/mt) this week delivered South Vietnam inclusive of taxes. ($1=VND23,181)

 

Indonesia

  • Indonesian mills were quiet this week with US suppliers increasing offers. Many yards stayed away from offering scrap to Indonesia due to the upcoming registration norm. They expect limited buying in December. 
  • The difference between offers and bids in Indonesia stayed around $10-15/mt cfr. The weekly Davis Index for HMS 1&2 (80:20) rose by $24/mt cfr Jakarta. 
  • The indexes for P&S 5ft and #1 HMS rose by $19/mt and $21/mt cfr Jakarta, respectively. 
  • The weekly Davis Index for #1 busheling rose by $20/mt. The weekly Davis Index for shredded rose by $20/mt cfr.

 

Thailand

  • The weekly Davis Index for domestic HMS 1&2 (80:20) rose by THB350/mt ($11.6/mt) delivered Rayong mill inclusive of taxes, amid rising demand. 
  • Imported scrap prices will rise further in December, which traders said will help sell domestic scrap at a higher price. A rise in freight price and shortage of containers has also made mills focus on domestic scrap. Domestic short supply of ferrous scrap too added to the price rise this week. ($1=THB30)

 

Malaysia 

  • The weekly indexes for HMS 1&2 (80:20) were unchanged in Malaysia where production and demand remain subdued due to increasing COVID-19 cases. 
  • Traders expect Malaysian domestic scrap prices to rise in December on the back of rising imported scrap prices. The market could see the release of pent-up steel demand once the rate of transmission slows. 
  • Rising iron ore prices and strong demand in China may boost the Malaysian appetite for scrap. ($1=MYR4)

 

India 

  • Imported ferrous scrap offers in India trended up amid bullish global cues. The continuous price rise has kept buyers away from the market despite strong domestic fundamentals. Major shipping lines have decided to lower the number of free days at some destinations, particularly in Asia, effective Jan 1, 2021, to deal with the shortage of containers. 
  • The Davis Index for containerized shredded on Friday cfr Nhava Sheva, was up by $8.55/mt from Thursday and by $29.02/mt from a week ago. There were very few deals as most mills have turned silent due to high prices. Bids by Indian mills lagged $15-20/mt behind current offers. 
  • The Davis Indexes for UAE-origin and US-origin HMS 1&2 (80:20) cfr Nhava Sheva, were up by $22/mt and $23.57/mt, respectively, from Dec 4. Domestic scrap remained a preferred choice for many buyers amid uncertainty in deliveries and economically unviable imported material. Domestic scrap is available in enough volumes amid a recovery in production activities.
  • The indexes for #1 busheling, P&S, and turnings rose by $29/mt, $23/mt, and $23/mt, respectively, from the prior week. High imported scrap prices pushed billet export prices up. 
  • International iron ore prices (Australian 62pc Fe content) were at $160/mt cfr China on Friday amid indication of supply concerns in the upcoming days. Chinese producers offered domestic billets ex-Tangshan, up by CNY100/mt from a week ago.

 

India domestic

  • Mandi Gobindgarh is largely facing the brunt of farmer’s agitation with a bearing on prices. Thus, the Davis Index for HMS 1&2 (80:20) rose by Rs700/mt from Thursday, gaining back the amount it had lost during the week but remained unchanged from last week. 
  • In Mumbai, the index for HMS 1&2 (80:20) settled unchanged from Thursday but up by Rs367/mt from a week ago. Availability of domestic scrap in the Mumbai market has eased, but bullish imported scrap prices have cushioned domestic scrap prices from falling. ($1=Rs73.76)

 

Pakistan  

  • Imported ferrous scrap offers in Pakistan shot up by $25-30/mt this week on global cues. Although most mills resisted these levels, those with limited inventories had no option but to accept the offers to keep operations running. There were very limited offers for Asian markets as most suppliers focused on Turkish bulk demand. 
  • The Davis Index for containerized shredded, Friday, gained $8.50/mt from Thursday and $27.43/mt from Dec 4 cfr Port Qasim. 
  • Amid acute shortage of HMS scrap, the Davis Index for UAE-origin HMS 1&2 (80:20) increased by $6/mt on Friday from the previous day and was up $25/mt from a week ago. The index for US-origin HMS 1&2 (80:20), Friday, cfr Port Qasim, was up by $8.14/mt from a day prior and by $23.39/mt from a week earlier. 
  • The weekly Davis Indexes for P&S and #1 busheling cfr Port Qasim, were up by $18/mt and $20/mt, respectively. Inquiries for other premium grades of scrap resumed this week to offset the shortage of shredded.
  • The Davis Index for G-60 billet was up PKR750/mt ex-work Punjab from Dec 4. 
  • The weekly Davis Index for G-60 rebar rose by PKR2,750/mt ex-works Karachi and ex-works Punjab by PKR2,143/mt from the prior week. A major mill in the South hiked rebar prices by PKR3,000/mt ($19/mt) effective Dec 10. Rebar makers continued to lift offers despite slow demand to pass on the increased input cost to end-users. 
  • Pakistan Association of Large Steel Producers (PALSP) and Association of Builders and Developers of Pakistan ABAD opined that the cost of steel has risen by almost 1.5-2pc for a house, which could hurt business sentiments and steel demand in the construction sector.
  • Many mills could cut production in winter. The index for Art Q toke scrap equivalent to a mix of HMS and P&S jumped by PKR714/mt ex-yard Lahore, Friday, from late last week. Domestic ferrous scrap prices in Pakistan rose on bullish global cues. For shipbreakers, offers for scrapped tankers cfr Pakistan rose $20-40/ldt from the prior week. ($1=PKR160.2)

 

Bangladesh

  • Bangladeshi steel mills aggressively restocked ferrous scrap, both in containers and bulk cargoes amid depleting inventories and rising steel prices. A persisting shortage of containers and rising freight costs have incrementally raised offers. 
  • A leading steelmaker bought an Australian mixed bulk cargo comprising (shredded, P&S and HMS) of around 30,000mt with prices up by $25-30/mt from the last booking. 
  • The Davis Index for containerized shredded, Friday, cfr Chattogram, up by $22.10/mt from prior Friday and $7.5/mt from Thursday. The indexes for busheling, P&S gained $20/mt from the prior week.
  • The Davis Index for containerized US-origin HMS 1&2 (80:20) cfr Chattogram, increased by $6.43/mt from Thursday and was up $21.07/mt from a week ago. Domestic markets in Latin America and the US firmed up amid a recovery in steel demand, which is cutting down offers to Asian countries.
  • High input costs lifted the weekly Davis Index for domestic billet, Friday, by BDT750/mt ex-works Chattogram with trades at the index price. Major steelmakers canceled discounts on most products. Many mills are facing a shortage of natural gas required for their operations.
  • The weekly Davis Index for rebar from medium-scale steelmakers was up by BDT1,500/mt ex-works, inclusive of VAT. Amid cash crunch, mills could announce production cuts to balance the supply-demand mismatch and avoid high input costs. 
  • Ship scrap equivalent to P&S rose in sync with a sharp rise in imported scrap prices. The weekly index rose BDT1,625/mt ex-yards on Friday. The weekly Davis Index for the grade settled ex-yards on Friday, up BDT1,750/mt. Offers for scrapped vessel imports were up $30/ldt from the prior week following global cues and rising plate prices. ($1= BDT84.68)

 

Metallics

 

CIS 

  • The weekly Davis Index for CIS basic pig iron surged by $36/mt in the Black Sea basin on Friday.
  • The demand for CIS pig iron was strong in the second week of December, but exporters agreed to sell only small cargoes as availability of the material is limited and prices may increase significantly following robust ferrous scrap and steel product prices. The most recent booking was done at $500/mt fob Black Sea for 10,000mt of Russian pig iron to an international trader on Dec 10.
  • The Turkish imported pig iron market remained active and a Russian producer sold 5,000mt of low-manganese material at $495/mt fob Black Sea. The solid demand for pig iron in Turkey was attributed to surging steel product sales and a bullish imported ferrous scrap market.
  • The weekly Davis Index for CIS pig iron in Italy jumped by $14/mt on Friday as suppliers raised offers. Some negotiations were taking place with no deals reported later.

 

US

  • The weekly Davis Index for basic pig iron (BPI) increased by $21/mt cfr New Orleans port on Thursday following fresh deals from Brazil and the CIS.
  • The US booked a cargo from Brazil at $470/mt cfr Nola and a much larger booking from the CIS came in at $480/mt cfr Nola. 
  • Metallic import increases have surged in tandem with domestic scrap, exports, and steel prices over the past month. In fact, BPI prices have risen about $100/mt since the beginning of November. Recent BPI values in China are at around $495-500/mt cfr, also indicating a growth of approximately $100/mt compared with $395/mt cfr levels at the start of November. 
  • The Davis Index for nodular pig iron (NPI) imports moved up by $70/mt cfr Nola on limited availability and current scrap price points. Some of the few existing offers for remaining material are as high as $580/mt cfr Nola, for Q2 2021 shipment.
  • The weekly Davis Index for US hot briquetted iron (HBI) imports rose by $15/mt cfr Nola. The import price estimate is based on domestic HBI trades, currently transacting at about $10/gt above prime scrap grades at production origin sites such as Cliffs in Ohio or voestalpine in Texas.

 

India

  • Sponge iron prices in the past months had surged on the back of bullish international iron ore prices and a shortage in India. From a week ago, Sponge iron prices in Mumbai fell by Rs100/mt, but rose by Rs1,000/mt in the Mandi Gobindgarh market. The rise in the Mandi market was largely driven by logistical challenges.
  • In the coming days, the resumption of iron ore mining in Odisha is expected to ease prices in India. ($1=Rs73.76)

 

India semi-finished and finished steel

  • The daily Davis Index for billet in Mumbai was largely flat from the previous Friday despite limited demand while the index for rebar rose by Rs500/mt ($6.79/mt) on healthy rebar sales throughout the week.
  • In Raipur, the daily index for billet was up by Rs100/mt ($1.35/mt) from the previous Friday. Sponge iron ore prices softened during the week while the daily index for rebar remained flat with steel mills reporting sluggish demand.
  • In Mandi Gobindgarh, the daily index for ingot was almost flat from the previous Friday due to low trade during the week.
  • In Jalna, the bi-weekly index for billet increased by Rs200/mt ($2.71/mt) on Thursday compared to the previous week, in line with the rise in rebar prices. The bi-weekly index for rebar was up by Rs200/mt due to good demand.
  • In Kutch, the bi-weekly index for billet increased by Rs500/mt ($5.43/mt) on Thursday from last week, following a surge in rebar prices with some deals heard at increased prices.

 

Shipbreaking 

  • Shipbreaking prices rose on Friday amid healthy demand from the re-rollers in Mandi Gobindgarh and Gujarat.
  • The daily Davis Index for 8ani rose by Rs900/mt ($12.21/mt) and 10Ani rose by Rs1,000/mt ($13.57/mt), compared to the prior week. 
  • The daily Davis Indexes for 0.5kg and 1kg plates increased by Rs850/mt each over the week, amid rising demand from government mills in Gujarat for the manufacturing of finished steel, cited a market participant.
  • The Davis Index for HMS attachments and Melting rose by Rs500/mt each from last Friday.
  • Shipbreakers expect the uptrend to continue while the demand for finished steel is likely to remain weak, at least until January 2021.

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