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

A gap of $30-40/mt between bids and offers led to a stand-off between sellers and buyers of imported scrap in India. As a result, the market was quiet on Wednesday. The union budget announced on Monday failed to have any short-term impact on market sentiment or prices. 

The Davis Index for containerized shredded, Wednesday, settled at $403.13/mt cfr Nhava Sheva, down by $3.75/mt from Tuesday. Buyers chose to stay silent citing a wide price gap between imported and domestic material. They are hoping for a further decline in seaborne scrap prices. But suppliers were unwilling to offer shredded below $405-410/mt cfr Nhava Sheva amid increased container freight rates. 


The weekly Davis Index for cast iron, rotors, and drums on Wednesday, was down by $7/mt to $386/mt cfr Nhava Sheva. Trades for Cast rotors were reported at $390/mt cfr Nhava Sheva late last week. But bids subsequently dropped to $380/mt cfr Nhava Sheva as buyers found present offer levels unviable.  

On Wednesday, Turkish domestic ferrous scrap was under pressure, with the index for HMS 1&2 (80:20) dropping by $10.63/mt to $398.75/mt cfr Turkey. South Asian buyers hope the price decline in Turkey will also pull down offer prices in their region.  


The Davis Index for UAE-origin HMS 1&2 (80:20), Wednesday, was at $346/cfr Nhava Sheva, down $3/mt from Tuesday. Offers for HMS #1 were at $360-365/mt cfr Nhava Sheva. A few mills in Jalna and Kutch booked containers of Dubai-origin HMS 1&2 (80:20) at $340/mt cfr Nhava Sheva.


In Chennai, mills preferred to book domestic HMS 1&2 (80:20), which is priced Rs1500-2000/mt lower at Rs24,500-25,000/mt delivered mill than UAE-origin HMS material. Buyers also sought containers of the grade at $315-325/mt cfr Chennai and raised inquiries with other supplier countries. 


The daily Davis Index for US-origin HMS 1&2 (80:20), Wednesday, was at $362/mt cfr Nhava Sheva, down $0.50/mt. Domestic HMS 1&2 (80:20) was unchanged at Rs26,500/mt delivered Mumbai mill on Wednesday and remained competitive against imported material. 

In China, ahead of the spring festival, prices have been on a downtrend. On Wednesday, Q235 150mm square billets prices in China dropped by CNY10/mt to CNY3,850/mt ex-works Tangshan, including 13pc VAT. Spot prices for Fe 62pc content iron ore dropped below $150/mt cfr China, the first time since September amid weak futures and easing supply. 


Chinese HRC exporters are worried of reduction in export tax rebate for HRC from 13pc to 8-9pc. They have also started to add new terms and conditions pertaining to a possibility of change in prices in export contracts to minimize possible losses. Fearing contractual losses, buyers have slowed purchases which has also pressured raw material prices in China.


A few Indian primary HRC makers hiked prices by Rs1,000-2,000/mt for February shipments for finished flat-steel. Auto demand is likely to remain firm for another couple of months in the country. 



The daily Davis Index for containerized shredded, Wednesday, settled at $396.03/mt cfr India subcontinent, down by $3.47/mt. The daily index for containerized US-origin HMS 1&2 (80:20) settled at $363.87/mt cfr India subcontinent, down by $1.21/mt. 



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