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

Pakistani mills continued active restocking of ferrous scrap from the overseas market despite high prices as inventories remained low and demand continued to firm up. The domestic steel market has absorbed past week’s price hikes, while large steelmakers seek to raise prices again in the next few days. In the absence of active demand for shredded at high prices in other subcontinental markets, Pakistani mills were the preferred buyers booking most of the tonnages.  


The daily Davis Index for containerized shredded, Monday, jumped by $13.27/mt at $503.27/mt cfr Port Qasim. The index has gained $30-35/mt till date in January. Traders believe there is room for another $10-15/mt rise amid short supply and increased demand. UK and EU-origin shredded in containers sold at $500/mt for 5,000mt; $505/mt for 2,000mt and $508/mt for 1,000mt cfr Qasim late last week. 


Amid containers shortages, higher freight charges have spiked the landed cost of imported ferrous scrap in Pakistan. On Friday, the weekly index for container freight route from New York to Pakistan rose by $16.79/mt to $38.46/mt. Availability and scrap generation in Europe is impacted by lockdowns and resurgence of the COVID-19 outbreak in the region. 


On the other hand, US suppliers continued to focus on either the domestic market, where demand is bullish or on Turkish bulk deals. The daily index for US-origin HMS 1&2 (80:20) settled at $460/mt cfr Port Qasim, up by $5.75/mt from the prior week. 


UAE suppliers sold #1 HMS to Pakistani buyers at $460/mt cfr Port Qasim while offers for containers of mixed #1 HMS and P&S sarya on Monday were above $460/mt cfr Qasim. Dubai-based yards preferred to sell to India, where demand and prices of finished steel have recovered. The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $455/mt cfr Port Qasim up $5/mt from the prior week.  


Billet and rebar 

Domestic steel prices remained high driven by imported scrap prices. Billet prices rose despite harsh winter as demand from the construction sector is recovering. On Monday, prices for domestic Bala billets heard at PKR108,000-109,000/mt ex-works Punjab and at PKR105,000-106,000/mt ex-works Lahore. 


In Karachi, all major rebar makers held rebar prices amid high ferrous scrap prices in the international market. A major mill kept G-60 rebar asking rates for 12-32mm at PKR135,000-135,500/mt ($840-841/mt) ex-works. Local rebar offered at PKR116,000/mt ex-works. G-60 rebar prices will soon reach PKR140,000/mt ex-works mark, claim rebar maker.


Domestic scrap

On Monday, local Art Q toke scrap equivalent to a mix of HMS and P&S offered at PKR87,000-87,500/mt ex-yard Lahore. Pure Q Toke (shredded) offered at PKR88,000-89,500/mt ex-yards, up PKR1000/mt on short supply and jump in imported scrap prices. For shipbreakers, the new year came with a demand uptick as prices for scrapped vessels climbed by $10-20/mt to $450-465/ldt cfr Pakistan on Monday.



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