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Ferrous market update: September 21-25

Ferrous Market Update 09/25/2020

 

Turkey

  • The daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) inched down by $0.13/mt on Friday with no deep-sea bookings reported, though a short-sea cargo was purchased.
  • Negotiations revived in the Turkish ferrous scrap market by the end of the week and bids were heard at or below $295/mt cfr for HMS 1&2 (80:20) from the Baltic region, but most suppliers refused to sell at those rates, expecting higher prices. US exporters remain out of the Turkish market.
  • A sale of bonus grade from Romania was done at $300/mt cfr Turkey, while bids for Romanian HMS 1&2 (80:20) are reported at $274-275/mt cfr, which are not acceptable to most sellers.
  • Some Romanian sellers switched to alternative outlets this week with two cargoes of HMS 1&2 (80:20) fob Romania changing hands at $280-281/mt cfr Greece this week.
  • The daily exported rebar prices in Turkey continued to vary in the range of $455-460/mt fob, while the weekly billet prices were flat at $430-435/mt ex-works. ($1 = TRY7.66)

 

Turkey domestic

  • The weekly Davis Indexes for DKP scrap and for extra grade scrap in Turkey were both flat on Monday.
  • Most Turkish mills chose to hold their purchase prices for local material at the same levels as last week since their production requirements remained unchanged.

 

CIS

  • The weekly Davis Index for HMS 1&2 (80:20) fob Baltic Sea decreased by $9/mt on Monday and dropped by $7/mt fob Black Sea in a weak export market.
  • Russian ferrous scrap export trading was slow, and the only deal closed was at $303/mt cfr South Korea for around 80,000mt of A3 material from Far East Russia last week.
  • Demand at other outlets was sluggish. Turkish mills, especially, suspended scrap purchases over a week ago, anticipating lower prices due to a slowdown in rebar sales.
  • Collection prices remained unchanged in the Russian scrap market. ($1 = RUB75.23)

 

Europe

  • The weekly Davis Index for HMS 1&2 (75:25) in the ARAG region decreased by €3/mt ($3.50/mt) on Tuesday in an inactive export market.
  • Most ferrous scrap suppliers in the Netherlands and Belgium opted to cut collection prices as export sales ceased more than 10 days ago after Turkish importers became silent and switched to steel product sales. (€1 = $1.16)

 

UK dockside

  • Davis Index’s weekly north and south UK HMS 1&2 (80:20) ferrous scrap indices both remained unchanged for the second consecutive week on Tuesday.
  • Major seaborne benchmarks, particularly to Turkey, softened further this week and dockside ferrous scrap prices remained unchanged as buyers awaited more clarity from the world’s largest seaborne routes.
  • Most UK market participants commented they were waiting to see who, out of Turkish buyers and European and US suppliers, would “show their hand first” in the next round of negotiations.
  • The sentiment was relatively mixed on price direction with one UK bulk exporter expecting prices to climb higher on the next flurry of orders. However, a major UK bulk processor believes prices for European-origin material would have to come down to $285/mt, cfr Turkey, while US exporters might still achieve $295/mt.
  • The weekly indices for north and south UK OA (Plate & Structural) also remained unchanged over the same period on September 22 as did the north and south UK 5A/5C (frag feed) ferrous scrap indices. (£1 = $1.28)

 

Spain

  • Davis Index’s weekly northern Spain HMS 1&2 (80:20) and shredded small bulk ferrous scrap indices declined by €6/mt ($7/mt) and €8/mt, respectively, on Friday.
  • Last concluded transactions for HMS 1&2 (80:20) imported into Spain were conducted in the range of €230-235/mt, cfr northern Spain, over the past week. Since that time, Spanish buyers were heard to have reduced bids to around €225/mt to reflect developments on major seaborne trade routes, particularly to Turkey.
  • The UK and North European exporters have partly pushed back on these lower bids in response to relatively high dockside purchase prices. However, one supplier commented that they were unwilling to discuss discounts given how staunch some mills had been in accepting price hikes over the past couple of months.
  • Davis Index’s UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded both declined by €8/mt on Friday. (€1 = $1.16)

 

US dockside

  • The momentum gained for US East Coast ferrous scrap dock collection prices over the past two months decelerated this week though dockside tags, which have trended up in Houston over the past three weeks rose again on Tuesday.
  • Scrap demand is sufficient and supply flows are moderate, though export activity waned, rendering sluggish price movement and subdued markets, on the East Coast and in the domestic Midwest region.
  • Collection prices along the East Coast are unchanged barring slight movements. HMS 1&2 (80:20) is currently trading at around $240-245/gt delivered East Coast dock, an increase of about $20/gt compared to August 18 price levels, while Houston dock prices are up by about $25/gt for HMS 1&2 (80:20) compared to September 1.
  • Views on dockside prices are diverging with some believing they will decline soon while some expecting prices to hold at current levels in the near term.
  • In Boston, the weekly Davis Index for export yard HMS 1&2 (80:20) moved up by $3/gt, P&S 5ft ticked up by $3/gt, and shredder feed slipped by the same amount delivered docks.
  • The weekly Davis Index for export yard buying prices in New York moved down by $1/gt for all grades.
  • In Philadelphia, the weekly index for export yard collection prices of HMS 1&2 (80:20) remained unchanged. The index for shredder feed slid down by $2/gt.
  • The weekly Davis Indexes in Houston increased $6/gt for HMS 1&2 (80:20) and P&S 5ft moved up by $17/gt. Shredder feed climbed $5/gt delivered. Domestic scrap demand remains healthy in Houston as steel mill sales have been strong.
  • US West Coast ferrous scrap dock prices were flat in Los Angeles, San Francisco, and Portland this week as the absence of Turkish buyers influenced global ferrous transactions.
  • Several bulk sellers on both the US Coasts believe that despite the downward pressure by Turkish mills, prices could remain unchanged or even increase slightly in the next round of negotiations.
  • The uncertainty around COVID-19 infections has made projections difficult but increased global economic activity and recovery plans, support unchanged or stronger finished steel and scrap prices for many exporters.
  • Buyers from India, Bangladesh, Pakistan, and South Korea finalized limited scrap import deals due to rising prices.
  • In Japan, a competing source for US-scrap, domestic scrap prices remained mostly flat and export offers began to soften by approximately $5-8/mt on #2 HMS or equivalent grades compared to last week.
  • The weekly Davis Indexes in Portland increased by $1/gt across all grades.
  • Domestic mills in the region increased scrap purchases by $20-25/gt during September trade, against the previous month’s prices. Domestic scrap trading on the eastern side of the US is expected to trade strong sideways to up $20/gt depending on grades and region, but mills prices in the Pacific Northwest could trade sideways to slightly up in October.
  • A pause in increasing export prices for the next two weeks would further cement limited increased offers by domestic mills.
  • In San Francisco, the weekly indexes were unchanged for all grades. Scrap yards continue actively selling to the docks that are seeking inventories to fill bulk orders. However, they remain concerned about softening export prices in October.
  • The weekly Davis Indexes in Los Angeles were rangebound for the fourth consecutive week.

 

US containers

  • US containerized ferrous scrap indices decreased on the East Coast for the second consecutive week. On the West Coast, scrap deals, which began softening towards the end of last week, declined further by Thursday.
  • The weekly Davis Indexes in New York decreased with HMS1&2 (80:20) falling by $6/mt, P&S 5ft decreasing by $10/mt, shredded slipping by $9/mt, and machine shop turnings dropping by $15/mt fas on retreating interest. However, #1 busheling increased by $1/mt.
  • Shredded scrap containers were actively quoted in the range of $275-290/mt fas. The higher quoting sellers remain confident about the present downturn being temporary and expect prices to rebound in the next two weeks. Asian buyers are tentative on accepting higher-priced offers given the potential for domestic scrap being sourced at lower prices in the short-term in those countries.
  • The Los Angeles Davis Indexes for containerized scrap dropped for #1 busheling and P&S 5ft by $9/mt, for HMS 1&2 (80:20) by $6/mt, and for shredded by $5/mt fas. Deals began to soften since last week with market participants reporting transactions at $265-268/mt fas then, which translated to $260-265/mt fas for most sellers by Thursday.
  • Sellers continue reporting limited scrap inventories with the possibility of this lull being another temporary pause in the market before heading into Q4 2020. Many Asian mills remained on the sidelines in the past month as prices surged and are expected to return to containerized buying activity in October and November.
  • The new Indonesian import requirements that come into effect on October 1 have also slowed down deals to the destination with sellers reporting that many Indonesian buyers are still trying to finalize their registrations with the expectation that most of the paperwork will be completed by mid-October.
  • The latest deal by a Turkish mill at $299/mt cfr on average affirmed that US-sourced scrap will likely maintain the $300/mt cfr-level on HMS 1&2 (80:20). Returning buying activity from Turkish mills could increase competition in the US domestic scrap market as well as the docks for relevant regions, thereby, supporting container prices next month.
  • Taiwanese and South Korean buyers are cautiously assessing their domestic and export markets for Chinese influence along with tracking a relatively stable, but risky finished steel environment.
  • Pakistani, Indian, and Bangladeshi buyers continue their delayed ferrous scrap purchases due to weak domestic steel demand, lower billet prices, and softer domestic scrap prices.
  • The Davis Indexes in San Francisco decreased across all grades, falling by $12/mt for #1 busheling, by $6/mt for shredded, and by $11/mt for HMS 1&2 (80:20) and P&S 5ft.

 

US domestic

  • The rising price trajectory for ferrous scrap is expected to carry into the October trade week though not to the same extent as September. Early indications suggest a rise of $10-20/gt in October over September settled prices with prime and shredded grades slated for the most growth. Some market participants see further upward price potential of $30/gt, in certain areas.
  • Supply and material flow into yards remain tight, especially for shredder feed in some regions. A few yard owners have noticed an extensive lack of peddler traffic. However, many dealers are witnessing a pickup in scrap flows and, in some cases, outpacing transportation capabilities.
  • Flows have increased by around 20pc for many yards in mid-September compared to last month, with some yards reporting inbound material movement at 100pc of typical, pre-pandemic volumes.
  • Various sellers are still shipping August orders while also trying to fulfill September ones amid some grumbles about trucking issues. Several mills in the Midwest, that have ramped up at the slowest pace for the past 60 days, are informing of low inventories and are preparing to buy added tons in October. Consumers and traders are already, actively inquiring about securing TBD orders this week.
  • In Chicago, a few major mills purchased supplementary spot material late in the September trade, at $15-25/gt above published numbers. These late deals may create a higher starting point for some base prices during negotiations for October tons.
  • Flat-rolled mills continue to steadily pick up the pace of steel production, while announcing measured price increases, also contributing to the gradual boost in scrap demand. The latest capacity utilization rate data stood at 65pc last week, while several market participants report mills are buying at about 80pc of typical levels. Mill order books are improving as aligned with a revival in the automotive sector.
  • Exports have slowed a bit due to some downward pressure from Turkey. However Turkish mills are expected to resume buying shortly to fulfill needs for October and thereafter. Domestic requirements in the US have been sufficient to maintain scrap demand, despite the pause in Asian trades.
  • Feasibly, scrap prices will not decrease during Q4 2020 with industry participants projecting them to remain unchanged to slightly up for the rest of 2020. The upcoming Presidential election is creating some uncertainty with regards to its outcome and how the result will affect the stock market as well as the steel industry.
  • Further price improvements are expected heading into Q1 2021, in line with improving steel sales, demand resurgence, and ongoing export activity, although some sellers believe the upcoming direction of exports is not entirely clear.

 

Mexico

  • Domestic ferrous scrap prices in Mexico rose for most grades due to higher demand from the automotive, manufacturing, and construction industries.
  • In October, recyclers are expected to struggle with collections within a 400km-radius from Monterrey.
  • In North Mexico, the weekly Davis Index increased by MXN163/mt for HMS 1&2 (80:20), P&S 5 ft, machine shop turnings, and #1 busheling and by MXN164/mt delivered for shredded.
  • The weekly Davis Indexes in Bajío increased for HMS 1&2 (80:20) by MXN100/mt, for P&S 5ft by MXN150/mt, for #1 busheling by MXN425/mt, and for shredded by MXN416/mt delivered Mexico consumer while machine shop turnings fell by MXN110/mt.
  • In Central Mexico, the Davis Index for HMS 1&2 (80:20), P&S 5ft, and machine shop turnings rose by MXN25/mt, respectively, while shredded increased by MXN417/mt and #1 busheling rose by MXN45/mt delivered Mexico consumer. ($1=MXN22.36)

 

Japan  

  • Japanese ferrous scrap export prices trended flat to down this week since most mills and ferrous scrap exporters stayed away from the market amid national holidays on September 21 and 22. A few buyers have already lowered their bids by JPY500-1,000/mt ($5-9/mt) following global cues.
  • The index for Japanese HMS 1&2 (50:50) dropped by $4/mt cfr Vietnam with trades heard at index prices.
  • In the domestic market, prices dropped by JPY500-1,000/mt this week amid tepid demand and easing supply. The Japanese currency appreciated to JPY104.5 against $1 from JPY105.5 a week ago.
  • Tokyo Steel has kept its domestic scrap procurement prices flat since September 15.
  • In the Kanto region, #2 HMS fas offers on Tuesday fell by JPY500-1,000/mt and the index for the grade declined by JPY750/mt fas. Mills in Vietnam and South Korea bought #2 HMS in limited quantities.
  • No trades for HS and shredded scrap were reported this week pulling down prices for these grades by JPY1,000/mt.
  • Market participants believe demand for ferrous scrap could improve in the Japanese domestic market since finished steel demand is showing signs of revival. JFE Steel has already refired its idled BF at Fukuyama works, earlier than scheduled. ($1=JPY104.5)

 

South Korea  

  • South Korean buyers have opted to wait before resuming imported scrap bookings as finished steel demand remains sluggish. They instead focused on purchasing more domestic scrap due to its availability.
  • The Davis Index for domestic Heavy A delivered Incheon and Pohang, Tuesday, dropped by KRW17,500/mt ($15/mt) with major steel mills like Hyundai, Donkuk, and others preferring domestic scrap. The weekly Davis Index for domestic Light A delivered Pohang mill fell by KRW10,000/mt.
  • South Korean steelmaker POSCO steel has ramped up its production to 100pc capacity. Global steel demand is likely to remain upbeat in H2 2020.
  • The weekly Davis Index for containerized HMS 1&2 (80:20) cfr South Korea fell by $3/mt. The weekly Davis Indexes for P&S 5ft, #1HMS, and shredded were down by $6/mt, $2/mt, and $5/mt cfr South Korea, respectively.
  • Hyundai steel has lowered bids for imported scrap by JPY1,000/mt from last week for grades like #2 HMS, #1 HMS, and HS. The steelmaker’s bids remained unchanged for shredded and shindachi (busheling) this week. ($1=KRW1,163)

 

Taiwan  

  • Rebar and billet prices are flat in Taiwan amid slow trading. Feng Hsin steel kept its finished steel prices unchanged from last week but lowered domestic scrap purchase prices by NT$300/mt ($10/mt) effective September 24.
  • The weekly index for domestic HMS 1&2 (80:20) in South and North Taiwan fell by NT$700/mt from the prior week.
  • In seaborne markets, US-origin containerized HMS 1&2 (80:20) dropped by $7/mt cfr Taiwan with very limited deals. The market is expected to slow down in Taiwan during the moon festival from October 1-4 and national holidays from October 9-11.
  • The weekly Davis Indexes for containerized P&S 5ft, shredded and #1HMS were down by $3/mt, $4/mt, and $7/mt cfr, respectively. ($1=$NT29.04)

 

China

  • In China, Shagang Steel lowered domestic scrap purchase prices twice in the week. The weekly Davis Index for the grade delivered mill fell by CNY110/mt from the prior Tuesday.
  • Chinese domestic billet is being offered at prices down CNY120/mt ex-Tangshan from two weeks ago.
  • Shagang Jiangsu has kept its finished steel prices flat from mid-September.
  • Most flat steel producers have resumed exports to Vietnam and other Asian markets at prices lower than current levels pressuring other exporter countries to reduce offers. ($1=CNY6.8)

 

Vietnam 

  • The weekly Davis Index for HMS 1&2 (80:20) fell by VND280,000/mt ($12/mt) delivered South Vietnam. Vietnamese mills remained cautious of bookings imported scrap expecting the prices to drop further in the coming days.
  • Steelmakers including Formosa steel were under pressure as HRC offers from China were lower by $10-15/mt than current market levels, weighing down domestic sentiment. The auto sector is driving flat steel demand and imports, but domestic production is yet to reach 100pc capacity.
  • In the bulk market, Japanese #2 HMS offers lowered by $5-10/mt cfr Vietnam. Vietnamese billet suppliers focused on exports with firm offers for October and November shipments.
  • In the containers market, the weekly index for HMS 1&2 (80:20) dropped by $11/mt cfr Vietnam. Limited deals were reported for containerized scrap as mills exercised caution to amid falling markets.
  • Shortage of domestic scrap and an expected recovery in finished steel demand could drive scrap bookings in October. ($1=VND23,210)

 

Indonesia

  • Indonesian mills focused on domestic scrap purchases this week. The implementation of new regulations effective October 1 kept buyers away from the market.
  • The weekly Davis Index for HMS 1&2 (80:20) lowered by $6/mt cfr Jakarta with no customers showing buying interest.
  • The weekly Davis Index for P&S 5ft dropped by $7/mt cfr Jakarta on Thursday. The indexes of #1 busheling and shredded moved down by $4/mt and by $5/mt cfr Jakarta, respectively, with no deals being heard. Indonesian billet imports are expected to rise over the next couple of months due to the new restrictions on ferrous scrap imports.

 

Thailand

  • The weekly Davis Index for domestic HMS 1&2 (80:20) fell by THB150/mt ($5/mt) delivered Rayong mill inclusive of taxes, with thin trades at the index price. Sluggish finished steel demand limited ferrous scrap purchases by Thai mills.
  • Imported billet prices dropped by around $10/mt cfr Thailand pulling imported scrap buying bids down this week. Most mills preferred domestic material over imports as overseas suppliers continued to raise offers.
  • Mills put off bookings in the week amid expectations of the market softening in the coming days. Exporters from the US offered limited ferrous scrap volumes to Thailand. Prices for mix P&S 5ft, #1 busheling, and shredded lowered by $5-10/mt from a week earlier. ($1=THB31.37)

 

Malaysia 

  • The weekly indexes for HMS 1&2 (80:20) dropped by MYR60/mt and MYR40/mt delivered western mills and eastern mills, respectively. Market participants are expecting demand for finished steel to pick up in October when the government-funded infrastructure projects are expected to gain momentum.
  • Most Hong Kong and South Korean suppliers expect Malaysian ferrous scrap consumption to increase in the coming days in absence of demand from Indonesia, where importers are staying away due to a new regulation taking effect from October 1. ($1=MYR4.1)

 

India imports

  • Weak export markets for Indian mills pulled down shredded scrap prices by $9/mt from a week earlier in India. Most mills preferred domestic scrap to reduce input costs.
  • The daily Davis Index for containerized shredded decreased by $1.23/mt cfr Nhava Sheva, from Thursday. The index dropped by $9/mt from last Friday.
  • In the bulk market, no trade for US-origin HMS 1&2 (80:20) materialized as buyers were not able to raise their bids. A shortage of oxygen forced many recycling yards and steelmakers to suspend operations, which also brought down buying interest. The non-availability of bulk resulted in more containerized trades this week.
  • The daily Davis Index for UAE-origin HMS 1&2 (80:20) fell by $1/mt from Thursday and $6/mt from a week ago.
  • The index for US-origin HMS 1&2 (80:20) decreased by $4.25/mt cfr Nhava Sheva from last Friday. But most suppliers believe the downside is limited and ferrous scrap prices could receive support in October when demand recovers. The possibility of a second wave of COVID-19 in the Europe and UK markets and elections in the US in November have added to market uncertainty.
  • Turning scrap buying inquiries increased this week and the weekly index for the grade fell by $10/mt cfr Nhava Sheva. ($1=Rs73.41)

 

India domestic

  • In most Indian domestic markets, ferrous scrap prices were under pressure this week.
  • On Thursday, however, the bi-weekly index for HMS 1&2 (80:20) rose in some North Indian markets amid an uptick in demand. In Ludhiana, the bi-weekly index for the scrap grade increased by Rs250/mt del mill. In Mandi Gobindgarh, the index on Thursday rose by Rs100/mt only to lose this gain on Friday. The index for HMS 1&2 (80:20) fell by Rs300/mt in one week.
  • In Raipur, the bi-weekly Davis Index for HMS 1&2 (80:20) fell by Rs200/mt. Restrictions akin to a complete lockdown have been imposed in Raipur and nine other cities in Chhattisgarh. This has hampered trades.
  • The index for HMS 1&2 (80:20) fell by Rs100/mt del Mumbai mill from Thursday and by Rs500/mt in a week.

 

Pakistan  

  • Pakistani ferrous scrap prices dropped for the second week. In two weeks, prices have declined by $15-20/mt. Bookings declined as suppliers have started resisting present bid levels amid tight supply while most major mills stayed away from purchases as domestic steel demand continued to lag.
  • The Davis Index for containerized shredded, cfr Port Qasim on Friday fell by $1.23/mt from Thursday and by $9/mt from the prior Friday. Around 3,000-5,000mt of UK/EU-origin shredded traded at index price on a cfr Port Qasim basis.
  • With Turkish mills resuming bookings for October-November shipments, a steep decline in the containers market seems unlikely.
  • The possibility of trades of finished flat steel at prices lower than the present market prices, especially HRC from China, has dampened market sentiment.
  • Agha Steel plans to move forward with an initial public offering (IPO) in October to raise about PKR5bn ($30.08mn) and expand its steelmaking capacity.
  • The Davis Index for UAE-origin HMS 1&2 (80:20) cfr Port Qasim, fell by $1/mt from Thursday and by $6/mt from a week ago. Suppliers offered lower volumes as they seek clarity on the extension of the ferrous scrap export ban. The indexes for P&S 5ft and busheling cfr Port Qasim, declined by $5/mt and $1/mt, respectively.
  • The weekly Davis Index for commercial Bala billet moved down by PKR250/mt ex-works Punjab on Friday. In Punjab, G-60 rebar prices on ex-works basis declined by PKR500/mt amid subdued demand. Finished steel prices in Southern Pakistan were under pressure as leading steelmakers offered discounts to liquidate inventories. Rains in the Southern region also impacted trades.
  • A downtrend in imported scrap prices pulled down domestic scrap prices. Pure Q toke scrap equivalent to shredded traded at prices down by PKR250/mt ex-yard Lahore from early this week. ($1=PKR165.39)

 

Bangladesh

  • Bangladesh’s domestic steel market has been less supportive of ferrous scrap imports for over one month. Importers continued buying only as per their need, while major mills have refused bulk trades amid enough inventories in hand to meet the current demand. Transportation activities were disturbed due to heavy rains and floods on the outskirts of Dhaka.
  • The Davis Index for containerized shredded declined by $5.5/mt on Friday from the prior week. Trades for containerized shredded from Europe, Australia, and New Zealand were reported in limited quantities. Most Japanese suppliers were away from bulk offers amid holidays.
  • The index for HMS 1&2 (80:20) dropped by $2/mt for UK/EU-origin material but remained unchanged for Australian scrap.
  • The index for Latin American HMS 1&2 (80:20) fell by $5/mt from a week ago. Trades for higher grade scrap were subdued amid limited buying interest.
  • The weekly index for domestic billet ex-works Chattogram settled unchanged. Market participants believe demand for rebar could take longer to recover to pre-pandemic levels.
  • Major steelmakers in Chattogram are offering volume-based discounts to push sales amid a pile-up of finished inventories. The weekly Davis Index for rebar from medium steelmakers settled unchanged on an ex-works basis from the prior week.
  • In the shipbreaking market, Bangladeshi recyclers kept offers flat from the prior week. Domestic shipbreaking scrap equivalent to P&S 5ft declined by BDT500/mt from the prior week. ($1=BDT84.62)

 

Metallics

 

CIS 

  • The weekly Davis Index for CIS basic pig iron decreased by $6/mt on Friday due to a softening market in China.
  • The CIS pig iron export market was active this week, but sale prices dropped to China as Asian importers started insisting on lower pig iron prices amid falling iron ore and steel product rates.
  • A Russian supplier reached an agreement at $390/mt cfr for 30,000mt of pig iron, and another exporter closed a deal at $385/mt cfr for 10,000-15,000mt of the material. Both cargoes will be shipped from Far East Russia.
  • A new transaction was also reported in the US pig iron market after a Russian supplier traded 50,000mt of the material from the Baltic Sea at $387/mt cfr this week, which is in line with last week’s deals at $387-388/mt cfr.
  • The weekly Davis Index for CIS pig iron in Italy increased by $3/mt on Friday with a fresh booking. Negotiations resulted in the sale of 10,000mt of Ukrainian material at $378/mt cfr this week.

 

US

  • The weekly Davis Index for basic pig iron (BPI) increased by $3/mt cfr New Orleans on Thursday as the latest offers came in at slightly elevated levels compared to last week’s sales prices.
  • US buyers showed little interest in purchasing BPI at the new offer prices of $390-395/mt cfr Nola, for December and January shipment, though a deal concluded slightly below that level on Friday.
  • Sentiment has fluctuated to some extent amid several variables including steel mill inventory levels, mill production uncertainty, scrap flows, export activity, and general price expectations.
  • The Davis Index for nodular pig iron (NPI) imports remained unchanged as the supply of the grade is tight and Brazilian producers are focusing on BPI production due to higher demand for the material. The latest offers for NPI would be around $405-410/mt fob Brazil, which equals $430-435/mt cfr Nola; however, US buyers view the price closer to $400/mt cfr Nola.
  • The weekly Davis Index for US hot briquetted iron (HBI) imports was flat. New offers or bids have not been reported for HBI due to lower demand, but pricing for the material is expectedly close to this level on Thursday, based on price trends for similar scrap alternatives.

 

India

  • The index for sponge iron fell by Rs300/mt del Mumbai mill from Thursday and by Rs600/mt. In Mandi, sponge iron prices fell by Rs800/mt in a week.
  • Market participants are eying mid-October when finished steel demand is expected to recover due to rising construction activity. ($1=Rs73.58)

 

India finished steel

  • The index for billet in Mumbai dropped by Rs800/mt ($10.8/mt) from the prior Friday and was in-line with a fall in rebar prices amid weak market sentiment. The index for rebar declined by Rs700/mt in the week.
  • In Raipur, the index for billet fell by Rs400/mt ($5.42/mt) from the previous Friday on low trading. The index for rebar fell by Rs400/mt from a week ago.
  • In Mandi Gobindgarh, the index for ingot fell by Rs450/mt ($6.1/mt) from the prior Friday.
  • In Durgapur, the bi-weekly index for billet decline by Rs800/mt on Thursday from a week ago as sellers were distressed to sell. The bi-weekly index for rebar dropped by Rs1,400/mt ($18.99/mt) due to sluggish sales.
  • In Chennai, the bi-weekly index for billet and rebar both declined by Rs400/mt on Thursday from the preceding week.

 

Shipbreaking 

  • Shipbreaking scrap prices this week declined by at least Rs900/mt ($12.2/mt) amid low demand from the mills driven by a slowdown in production due to a shortage of oxygen cylinders. The daily Davis Index for HMS attachments and Melting declined by Rs950/mt ex-Alang yard from September 18.
  • Demand for rolling scrap remained subdued and weighed down the index for 8Ani by Rs1,050/mt ex-Alang. The index for 10Ani declined by Rs11,500/mt ex-Alang in a week.
  • The demand for steel plates remained low due to weak domestic fundamentals. Exports by mills have also declined. The index for 2kg plates declined by Rs1,000/mt ex-Alang on Friday from a week ago.
  • Shipbreakers are expecting prices to remain under pressure till the oxygen cylinder crunch eases since most Alang yards remain affected. ($1=Rs73.41)

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