Turkey
- The daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) climbed by $0.02/mt on Friday as suppliers rejected bids at $270/mt cfr.
- Some mills were ready to buy HMS 1&2 (80:20) from the USA and the Baltic region at $270/mt cfr on Friday, but most suppliers refused to sell at that level with offers moving to $272-275/mt cfr amid strong demand and active negotiations.
- The weekly Davis Index for Turkish DKP scrap increased by TRY72/mt on Monday and rose by TRY60/mt for extra grade scrap as demand increased.
- Trading continued in the Turkish rebar domestic market, and daily spot prices were flat TRY3,490-3,520/mt ex-works, including 18pc VAT, on Friday.
- Considering the current scrap requirements in the domestic market, Turkish mills have raised purchase prices for shipbreaking scrap by $3/mt since Wednesday. As a result, prices for this material increased by $15/mt during the week. ($1 = TRY6.85)
Europe
- The weekly Davis Index for HMS 1&2 (75:25) delivered dockside rose by €5/mt on Tuesday in the ARAG region, amid an uptrend in the export market.
- Dockside ferrous scrap prices in the Netherlands and Belgium increased as suppliers insisted on higher prices to Turkey, considering better demand there.
- European scrap suppliers have also additional reasons for higher prices, including exchange rates amid Euro revaluation against US dollar. Moreover, freight rates increased to around $20/mt for a 30,000mt-cargoes. (€1 = $1.15)
CIS
- The weekly Davis Index for HMS 1&2 (80:20) from Russia’s Baltic Sea and Black Sea regions increased by $11/mt and by $7/mt, respectively, with collection prices.
- Collection prices trended flat in Russia with the weekly Davis Index for HMS 1&2 (80:20) sliding by RUB50/mt ($0.70/mt) delivered St Petersburg dock and holding at last week’s levels for material delivered to Rostov-on-Don dock on Monday. ($1 = RUB71.41)
UK
- Davis Index’ weekly north and south UK HMS 1&2 (80:20) ferrous scrap indices increased by £5/mt ($6/mt) and £6/mt, respectively, delivered dockside in the week of July 21.
- Robust export demand for bulk and containerized ferrous scrap from buyers in Turkey, India and Pakistan prompted most UK processors to lift dockside purchase prices to secure healthy inflows and fill booked vessels.
- Those UK bulk exporters who had been paying local merchants for material at the lower end of the spectrum noted that supply had slowed noticeably given that prices from other yards inched up £2-3/mt each day.
- Davis Index’s Turkish HMS 1&2 (80:20) ferrous scrap import index has climbed from a recent low of July 10 to a recent high of $271/mt cfr on July 24, enabling bulk suppliers to pay more for feedstock.
- Davis Index’ UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded indexes witnessed hikes of €10/mt this week amid robust demand. (£1 = $1.27) (€1 = $ 1.16)
Spain
- Davis Index’ weekly northern Spain HMS 1&2 (80:20) and shredded small bulk ferrous scrap indexes increased by €8/mt ($9/mt) on Friday.
- Robust export demand for bulk and containerized ferrous scrap from buyers in Turkey, India, and Pakistan prompted most EU and UK processors to lift dockside purchase prices by €5-7/mt over the same period to secure stable inflows.
- Moreover, one UK-based bulk ferrous scrap supplier noted that strong export demand had encouraged buyers to increase bids by £2-3/mt per day over the past week; enabling processors to pass on higher collection prices.
US domestic: August outlook
- Market expectations for US August ferrous scrap trade range from sideways to a price decline of $5-30/gt depending on grade and region.
- Construction material such as rebar, which faced a lagged effect with COVID-19 is now confronting softer orders as municipalities and states cancel or defer projects, according to fabricators. The decline in orders could reflect in lower capacity utilization at mills as well as lower scrap buys during the month.
- Market participants expect further compression on prime grades due to overcapacity on the finished side and pressure on hot-rolled prices because of weak demand.
- Moreover, the spread between busheling and shredded widened in May due to industrial shutdowns but a downward correction of $40/gt was encountered in the Midwest and Southeast in July, with prices declining by $20-30/gt in Texas during the same period as supply outpaced demand.
- The market now expects another $20-30/gt price erosion on primes in the August trading week due to lower demand, higher availability, and wider spreads.
- Regional variations will continue in August with cuts and fragment grades in the Midwest likely to trade down $5-10/gt with stronger sideways expectations in Southeast and South, compared to July settled prices.
- Davis Index has been informed of placements in the lower Midwest that are already following a $10/gt downtrend.
- Some scrap sellers are reporting an estimated 10pc decrease in scrap inflows in July compared to June, while others are seeing near empty yards with few demolition prospects to boost inventories.
- In export, apart from higher ex-US Turkish deals, Pakistan and other Asian destinations have continued purchasing ferrous scrap, which is firming up prices. However, they are still not high enough to draw non-traditional exporters to shift supplies to export outlets.
- September ferrous scrap prices are expected to be buoyed by tighter scrap supplies, slightly higher demand, and higher HRC prices.
- HRC prices have struggled to meet the targeted $500/nt ($551/mt) fob mill prices and are transacting at $440-480/nt ($485-529/mt) fob mill.
- US Steel and AK Steel announced sheet price increases of $40/nt ($44/mt) to shore up pricing as demand is expected to recover in late August and September.
US dockside
- US East Coast ferrous scrap dock prices increased on rising demand for imported scrap in Turkey.
- In Boston, the weekly Davis Index for export yard HMS 1&2 (80:20) increased by $4/gt, P&S 5ft increased by $5/gt and shredder feed rose by $1/gt.
- The weekly Davis Index for export yard buying prices in New York increased by $4/gt, P&S 5ft rose by $5/gt and shredder increased by $7/gt. The same upward trend was evident in Philadelphia.
- The weekly Davis Indexes in Houston regained the $3/gt price erosion last week across the three grades.
- Dock prices improved on a flat outlook on cuts and fragmented grades in the regional domestic market, stronger Turkish import prices in the latest deals, active container inquiries to Asian buyers, and continued demand from Mexico. Dock collection prices in Houston continue higher than those on the East Coast.
- US West Coast ferrous scrap dock prices were mostly rangebound this week. Shredder feed prices increased in Portland while other grades trended flat. Los Angeles and San Francisco indexes encountered minor declines.
- US-sourced scrap was provided price support after Japanese export scrap prices increased. Moreover, buyers report availability of limited scrap inventory for the desired time frames in late August.
- In Portland, dock prices are expected to improve by early August as mill prices are more attractive to scrap dealers, even with the higher processing to meet the quality requirements.
- Recent bulk deals at $270/mt cfr India for shredded and several at $270/mt cfr Bangladesh also for shredded were heard in market.
US containers
- US containerized ferrous scrap indexes increased on the West Coast for the second consecutive week while East coast prices trended mostly soft to sideways.
- Containerized activity alongside the East Coast continues but without a marked increase in scrap demand.
- Sellers report mostly unchanged prices and are shaving off a few dollars possibly to close deals as Bangladesh and Pakistan buyers slowed down their inquiries due to an upcoming holiday.
- Last week, shredded scrap offers trended slightly lower against P&S 5ft, but this week several sellers reported the grades were being quoted at the same levels for some buyers.
- The weekly Davis Index in New York for #1 busheling and HMS 1&2 (80:20) decreased by $2/mt, P&S 5ft held at last week’s levels, and shredded increased by $2/mt.
- The West Coast continued to benefit from tighter scrap supply in the region and active material buys from Taiwan, Vietnam, and India on expectations of increased steel imports to China as it recovers. Moreover, countries such as Indonesia foresee an increase in steel usage on the return of infrastructure projects.
- Higher imports of Japanese finished steel products remain a strong concern in Korea and mills are seeking to address the dumping with the commerce department. Increasing Japanese scrap export offers along with Turkey’s higher import scrap prices are supporting higher export scrap prices in the US, Australia, and Russia.
- The weekly Davis Indexes in Los Angeles for #1 busheling was unchanged this week after an increase by $12/mt last week. The index for HMS 1&2 (80:20) rose by $4/mt while the index for both, P&S 5ft and shredded increased by $5/mt.
- The Davis Indexes in San Francisco followed Los Angeles with increases on most grades. The index for #1 busheling increased by $5/mt while HMS 1&2 (80:20) rose by $3/mt and both P&S 5ft and shredded increased by $5/mt.
- In Los Angeles, containerized HMS 1&2 (80:20) increased by $8-15/mt as containers prices rose from $205-217/mt fas to $220-225/mt fas this week.
- Better container prices are being supported by higher competing Japanese export prices along with a hesitation by large mills to cement bulk buys due to market uncertainty. A large South Korean mill, for example, is delaying bulk negotiations until August, increasing domestic buys, hedging with imported container buys, and relying on the long-term contracts already set in place for short-term scrap deliveries prior to determining bulk needs.
Mexico
- Ferrous scrap prices declined for most grades in the Bajío and Central areas of Mexico due to weak demand on Friday.
- Ferrous scrap prices in the Bajío and Central areas have decreased by around $200/mt over the past three weeks, but market participants anticipate they will hold at current levels after the latest round of declines over the next few weeks.
- A stabilization in scrap prices is expected to allow recyclers to sell more volumes to mills.
- In Northern Mexico, the weekly Davis Index for HMS 1&2 (80:20), shredded, and P&S 5ft was unchanged delivered Mexico consumer on Friday. The index for #1 busheling fell by MXN50/mt and increased for machine shop turnings by MXN150/mt.
- The weekly Davis Index in Bajío was unchanged for HMS 1&2 (80:20). The index for #1 busheling declined by MXN50/mt while shredded and P&S 5 ft prices held at last week’s levels.
- In Central Mexico, the Davis Index for both HMS 1&2 (80:20) and #1 busheling fell by MXN50/mt. The indexes for P&S 5ft and shredded remained at last week’s level.
($1= MXN22.27)
Japan
- Tokyo Steel has scheduled BF maintenance activities amid low demand. The steelmaker has also decided to revamp its continuous pickling line at the facility in Kurashiki, Okayama works.
- Japanese ferrous scrap export prices rose by another JPY1500-2000/mt ($14-19) this week supported by demand from Vietnamese and South Korean mills.
- The weekly indexes for #2 HMS, busheling, and HS on fas Tokyo bay basis rose by JPY1,500/mt from the prior week.
- In small bulk cargoes, #2 HMS prices were up by $10-12/mt cfr Vietnam from the prior week. HMS 1&2 (50:50) prices on cfr Vietnam basis increased by $8/mt from the prior week.
- Posco announced bids for Japanese shredded and HS scrap through open tender this week. These bids are JPY1,500/mt higher than the current market levels. ($1=JPY107.1)
South Korea
- The weekly Davis Index for containerized HMS 1&2 (80:20) rose by $10/mt on global cues.
- Mills in Korea are struggling with weak finished and semi-finished steel demand. But active trades in Turkey drove ferrous scrap prices upwards.
- The weekly index for US-origin HMS 1&2 (80:20) rose by around $8/mt on Wednesday. The indexes for #1 HMS, shredded increased by $9/mt and $10/mt, respectively.
- Dongkuk, SeAH, YK, Daehan, and Hyundai Steel lowered their domestic scrap purchase prices by KRW5,000/mt ($4.18/mt) del mill for a fourth successive week.
- In seaborne trades, the index for US and Australian-origin containerized HMS 1&2 (80:20) rose by $2-7/mt from the last week.
Taiwan
- Domestic prices for HMS 1&2 (80:20) in South Taiwan were unchanged from the prior week.
- Feng Hsin Steel also kept its prices for rebar and billets unchanged.
- CSC steel raised finished steel prices for September deliveries by 1.5pc. ($1=NTD29.49)
China
- In China, Shagang Steel raised bids for domestic #2 HMS (6-10mm thickness) scrap by CNY30/mt del Jiangsu mill.
- The weekly Davis Index for domestic HMS 1&2 (80:20) delivered to mill in eastern China increased by CNY50/mt.
- In the domestic market, billet prices declined by CNY30-40/mt ex-Tangshan mill on Tuesday. ($1=CNY7)
Vietnam
- The Davis Index for HMS 1&2 (80:20) delivered South Vietnam rose by VND50,000/mt from the prior week.
- HRC prices increased by $20-30/mt for September shipments as major steelmakers like Hoa Phat and Formosa hiked domestic steel prices. ($1=VND23,195.3)
Indonesia
- Most mills have ramped up production amid expectations of improvement in finished steel trades next month when major infrastructure projects are scheduled to commence.
- Due to a shortage of domestic ferrous scrap, many mills have come under pressure to buy bullish imported scrap to keep up their production.
- The index for HMS 1&2 (80:20) rose by $8/mt from the prior week and the index for #1 busheling rose by $15/mt. Prices for P&S increased by $7/mt and for shredded by $12/mt.
- Sellers expect buying activity to increase in the country in the coming weeks. Domestic P&S scrap offers were at $300-310/mt del mill.
Thailand
- The weekly Davis Index for domestic HMS 1&2 (80:20) inched up by THB50/mt delivered Rayong mill, inclusive of taxes. ($1=THB31.70).
Malaysia
- The weekly Davis Index for domestic HMS 1&2 (80:20) rose by MYR20/mt from the prior week in line with rising imported scrap and iron ore prices. ($1=MYR4.26)
India Imports
- Indian buyers resumed trades for imported scrap this week after resisting bullish offers last week. Although domestic scrap remains more viable over imported, a shortage of domestic material forced many mills to opt for imported scrap.
- There are indications of stronger finished steel prices in the coming months on high raw material prices and shortage of iron ore and coking coal.
- A major steelmaker in Gujarat booked 32,000mt shredded bulk cargo from the US west coast. Billet exports continued at prices which were up by $10-15/mt from the prior week.
- The Davis Index for containerized shredded, on Friday, cfr India subcontinent, rose by $3.56/mt from Thursday.
- The Davis Index for containerized shredded cfr Nhava Sheva on Friday, up by $5.33/mt from a day ago, and by $11.33/mt from the prior week.
- West Africa, Australia, Brazil-origin HMS 1&2 (80:20) traded at price levels $10/mt higher from the prior week. to steel mills in Goa and Chennai. Prices are expected to rise further next week.
- Brazilian traders sold Turning at prices $10-15/mt up from the prior week.
- Prices for domestic ferrous scrap rose this week following the increase in the seaborne market. From Monday, the index for HMS 1&2 (80:20) in Mumbai rose by Rs500/mt del mill.
- In Mandi Gobindgarh, the index for HMS 1&2 (80:20) rose by Rs100/mt del mil during the week.
- In Ludhiana, the bi-weekly index for HMS 1&2 (80:20) rose by Rs500/mt ($6.68/mt). A rise in scrap prices along with pressure on finished steel demand in the north has distressed most mills.
- Steelmakers are delaying production ramp-up and scrap purchases until the market presents clear fundamentals.
- The Chennai ferrous scrap market also mimicked global price trends and the bi-weekly index for HMS 1&2 (80:20) rose by Rs500/mt.
- Prices for domestic ferrous scrap in India are expected to rise in the near term, as inventories with most mills have started to deplete. ($1=Rs74.86)
Pakistan
- Many Pakistani buyers accepted offers without negotiations amid fears of prices further in the coming days. The steel production rate is reported to have neared pre-COVID-19 levels.
- The Davis Index for US-origin containerized shredded rose by $7/mt from the prior Friday.
- The Davis Index for HMS 1&2 (80:20) from the UAE rose by $9.31/mt from a week ago.
- Latin American traders sold blue steel, P&S, and LMS bundles at prices $10-15/mt above last week’s levels.
- The Davis Index for P&S and busheling moved up by $6/mt and $8/mt, respectively, from the prior week.
- Domestic ferrous scrap prices in Pakistan rose in step with higher imported scrap by PKR250/mt from a week ago.
- Domestic steel prices were mixed this week. Ahead of Eid-al-Adha holidays, steel demand slowed this week. In some parts of the country, firm imported scrap prices pushed finished steel and domestic scrap prices up.
- Prices for commercial Bala billet and G-60 rebar ex-works Punjab dropped by PKR500/mt from the prior week. ($1=PKR168.06)
Bangladesh
- Bangladesh mills booked ferrous scrap for their bare minimum requirements.
- Japanese ferrous scrap prices increased by $10-15/mt this week following global cues. Despite the price rise, around five small bulk cargoes were booked by mills in the country.
- The Davis Index for containerized shredded, Friday, rose by $3.12/mt from Thursday and by $5/mt from the prior week.
- The index for US-origin HMS 1&2 (80:20) rose $5.13/mt from a week prior. Trades for #1 HMS from Australia and Brazil were reported at prices which were $10/mt higher than the prior week’s levels.
- The weekly index for domestic billet settled down by BDT750/mt from the prior week. Weak end-user demand amid monsoon season has hurt trades.
- The weekly Davis Index for rebar from medium steelmakers dropped by BDT1000/mt. Dhaka-based small-scale long steel producers offered a discount to liquidate their inventories.
- Domestic ferrous scrap prices dropped by BDT1,500-2,000/mt this week due to oversupply. Sponge iron from India was imported at prices which were $10/mt higher from the prior week. ($1=BDT84.77)
Metallics
CIS
- The weekly Davis Index for basic pig iron fob Black Sea rose by $2/mt this week as suppliers remained firm in their offers due to limited allocation of the material.
- Demand for pig iron rose in Turkey this week resulting in a Ukrainian supplier selling 10,000mt of the material at around $330/mt cfr to a Marmara-based company.
- The weekly Davis Index for CIS pig iron in Italy increased by $2/mt on Friday as exporters insisted on higher prices, referring to sales to alternative outlets.
- A Russian supplier sold 10,000mt of pig iron at $338/mt fob Baltic Sea to Spain for September shipment and raised offers from this region to $340/mt fob.
US
- The weekly Davis Index for basic pig iron (BPI) increased by $3/mt cfr New Orleans on Thursday as producers continued offering material to the US at increasing prices based on sales to other locations.
- Producers offered material at $355-365/mt cfr Nola from the CIS and at around $360/mt cfr Nola from southern Brazil but, US buyers are more likely or willing to pay around $335-340/mt cfr Nola.
- The Davis Index for nodular pig iron (NPI) imports declined by $2/mt cfr Nola as offers for the material were restricted and new bookings had not been confirmed.
India
- In Mumbai, sponge iron prices rose by Rs400/mt del mill but fell by Rs200/mt del mill in Mandi Gobindgarh.
- In Ludhiana, the bi-weekly index for sponge iron, increased by Rs200/mt to Rs19,950/mt del mill amid pressures on finished steel demand because of rising scrap prices.
- The Chennai ferrous scrap market also mimicked global price trends and the bi-weekly index for sponge iron rose by Rs500/mt.
Finished steel
- The index for billet in Mumbai on Friday increased by Rs650/mt ($8.68/mt) from the prior day and by Rs 1,100/mt ($14.7/mt) from the previous Friday, backed by healthy buying from rolling mills producing structural steel products. The index for rebar rose by Rs300/mt ($4.01/mt) from Thursday and by Rs1,200/mt (16.04/mt) from the previous Friday.
- In Raipur, the index for billets rose by Rs400/mt ex-works due to an increase in pellet sponge iron and pig iron prices. The index for rebar increased by Rs400/mt.
- In Mandi Gobindgarh, the daily index rose by Rs200/mt for ingot and by Rs150/mt for rebar.
Shipbreaking
- Rolling scrap prices in Alang this week declined by Rs900-1,000/mt amid low demand from the mills. Recyclers lowered offers to clear the piled-up inventories.
- The index for 8Ani declined by Rs1,050/mt and the index for 14Ani declined by Rs1,000/mt ex-Alang.
- Demand for plates remained low on Friday as compared to July 17 as construction activity in the country has slowed down due to monsoons. The index for 5kg plates declined by Rs417/mt ex-Alang from last week. Prices, however, were up by Rs100/mt from the prior day.
- The index for HMS attachments and Melting rose this week by Rs700/mt as mills preferred domestic scrap due to quicker delivery. Availability for scrap is still low in the domestic market.