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

Demand for imported ferrous scrap in Pakistan continued to remain high. Chinese steel prices are bullish which has turned the market sentiment positive. 

Although domestic steel sales have improved, they are below steelmakers’ expectations. Steel prices rose amid tight supply and as most furnaces attempted to raise asking rates on increased landed prices for ferrous scrap.  

In March, the domestic scrap market in the US is expected to rise compared to February settlements amid low collection rates and resulting shortages at yards. This could have a bearing on offers to South Asian markets. 


The daily Davis Index for containerized shredded, Friday, inched up by $0.8/mt to $453.93/mt cfr Port Qasim. Prices increased by $38.22/mt from the prior week. Pakistani buyers were willing to pay higher than their Indian and Bangladeshi counterparts. A few trades for shredded were heard at $450-455/mt cfr Port Qasim. But at the week’s close, mills took a step back to see if Chinese prices sustain. 


In Turkey, mills focused on sales of rebar and billet but slowed bulk bookings. Mills are likely to raise their seaborne scrap purchase prices once they return to the market. The daily index for US-origin HMS 1&2 (80:20) settled at $420/mt cfr Turkey on Thursday, up by $2.5/mt. Prices could rise by another $20-30/mt till February-end on widened spread between scrap-rebar above $200/mt from a usual of $160-170/mt, said traders. 


The index for US-origin HMS 1&2 (80:20) settled at $417.29/mt cfr Port Qasim, up by $0.86/mt from Thursday and by $34.79/mt from February 12. An increase in scrap prices in the US fas market by around $10-15/mt pushed offers up in South Asian markets. Only a few offers of containerized HMS 1&2 (80:20) at $400-405/mt cfr Port Qasim for March deliveries were there in the Pakistan market amid elevated freight charges. 


Offers for #1 HMS and P&S from UAE were at $425-430/mt cfr Port Qasim depending on quality. The daily Davis Index for UAE-origin HMS 1&2 (80:20) was up by $1/mt to $418/mt cfr Port Qasim. Trades for containerized UAE-origin HMS 1&2 (80:20) were at $415-420/mt cfr Port Qasim. Mills opted for Dubai-origin HMS 1&2 (80:20) as mills found shredded offers unviable in the current market scenario. 


The weekly Davis Indexes for P&S 5ft and #1 busheling settled at $450/mt and $478/mt cfr Port Qasim, up by $31/mt and $35/mt, respectively. Only some buyers were willing to negotiate for premium grades amid a sharp jump in prices and a wide gap between bids and offers. 


Domestic billet surges, sales slow

On Friday, the weekly index for domestic Bala billet rose by PKR5,750/mt ($36/mt) to PKR102,500/mt ($646/mt) ex-works.

The Davis Index for G-60 billet settled at PKR111,250/mt ex-works Punjab. In Lahore, G-60 billet traded at PKR111,000-112,000/mt ex-works. Demand is expected to pick up gradually as positive sentiment spreads across markets. 

The weekly Davis Index for rebar rose by PKR500/mt to PKR127,500/mt ex-works Karachi, while in Punjab, the index decreased by PKR1,250/mt to PKR125,250/mt ex-works. Local rebar traded at PKR110,000/mt ex-works. 

Domestic scrap uptick on high imported scrap

The weekly index for Art Pure Q toke scrap equivalent to a mix of HMS and P&S Friday increased by PKR3,500/mt ($22/mt) to PKR81,750/mt ex-yard Lahore. The weekly index for Pure Q Toke equivalent to shredded increased by PKR3,250/mt to PKR83,250/mt ex-yards. 

Large mills in Southern regions could sell rebar at higher prices and are likely to resume restocking for ferrous scrap soon. With technological advancement, these mills have lowered their conversion costs, impacting small furnaces state traders.




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