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

Imported ferrous scrap offers to India remained limited as few buyers bought scrap on steady rebar demand. Most buyers turned caution amid a bleak outlook for steel demand due to the resurgence of the COVID-19 cases in many states. Local governments have imposed strict restrictions in some most-affected regions. While workers are resisting working full time amid fear of infection, thereby impacting productions and transportations of scrap and steel.  


The daily Davis Index for containerized shredded Monday dropped to $421.43/mt cfr Nhava Sheva. Most secondary mills are targeting $405-410/mt cfr Nhava Sheva and are unlikely to raise bids, while a few alloy makers were willing to accept below $420/mt cfr Nhava Sheva. 


In Turkey, mills opted for small bulks at lower prices amid volatile currency and pressured rebar sales. Bids in the subcontinent have dropped on hopes of another $10-15/mt downside. The wide gap between bulk and container offers kept mills waiting for a further drop. Mills claims that improving collection rates and rising supply would bring ferrous scrap prices under pressure. A month-long lull during Ramadan in April-May followed by monsoon season for the next three months may hamper steel demand in India.  


The daily Davis Index for UAE-origin HMS 1&2 (80:20), Monday, settled at $391/cfr Nhava Sheva, down by $2/mt. Buying interest was at $385/mt cfr Nhava Sheva. Minor trades for Dubai-origin HMS #1 and P&S reported at $395-405/mt cfr Nhava Sheva.


The daily index for US-origin HMS 1&2 (80:20), Monday, settled at $403.75/mt cfr Nhava Sheva, down by $3.75/mt from Friday. With most US suppliers under pressure to sell materials. Prices could drop more from the suppliers’ end, yet high freight rates could offset the drop by upto $10-12/mt. Offers for HMS 1&2 (80:20) from the UK and Australia dropped to $395-405/mt cfr Nhava Sheva with buyers’ expectation at $10/mt below offers. 


Inquiries for turning scrap were in the range of $370-375/mt cfr Nhava Sheva, down $10-15/mt from a week prior. Bids for West African HMS for 20-21mt loading with CI-GI were at $365-370/mt cfr Goa on Monday. Trades may resume with rising domestic Sponge iron price. 


With the revival in construction activities, rebar demand has been strong in some regions, especially in Mumbai. On Monday, Shipbreaking melting scrap offers in Alang, jumped on limited supply. But most buyers remained less interested ahead of Holi and Easter holidays next week. Prices reported at Rs31,300-31,400/mt ex-Alang. The strike against GST compliance challenges in Mandi Gobindgarh could extend further on non-fulfilment of their demands, said sources. 


In China, inventories have started piling up pulling steel futures down by 5-6pc on Monday. Spot imported iron ore 62pc ferrous content is expected to drop below $160/mt cfr North China on Monday. Domestic billet prices in the retail market, however, increased to a record high of CNY4,600/mt ex-Tangshan, up CNY110/mt, including VAT hitting a nine-year high. A lack of clarity on the export rebate rate in China has led to some price volatility. Rebar and HRC prices too increased by CNY70/mt and CNY100/mt respectively. 



On Monday, the daily Davis Index for containerized shredded dropped to $414.71/mt cfr Indian subcontinent, down by $14.45/mt. The daily index for containerized US-origin HMS 1&2 (80:20) settled at $398.95/mt cfr Indian subcontinent, down $13.54/mt from a day ago. ($1=Rs72.49)

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