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

Pakistani ferrous scrap buyers continued to limit shredded scrap trades to need basis. Domestic finished steel demand is expected to recover gradually in the coming days as China returns after the holidays. Many mills resisted higher offers. Non-recovery of rebar sales has dampened market sentiments. For the last two months rebar sales have remained subdued and it is unlikely that demand for ferrous scrap will improve before this year’s closure. 


The Davis Index for containerized shredded settled Friday at $304.71/mt cfr Port Qasim, down by $1.41/mt from Thursday, losing $5/mt from the prior week. Trades for containerized shredded of Europe-origin were reported at $303-305/mt cfr Port Qasim. Offers from UK yards on Friday, however, were above $308-310/mt cfr Port Qasim. The appetite for imported scrap is low, especially since the supply of rolling scrap from ship recycling has improved.  


In Turkey, the daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) dropped $4/mt from last week to $285/mt cfr Turkey in a couple of new trades.  


Amid renewed buying interest in India, HMS scrap prices in Pakistan showed mixed trends. Dubai being the preferred supplier offers registered an uptick in the early half of the week. On Friday, the Davis Index for UAE-origin HMS 1&2 (80:20) settled at $286/mt cfr Port Qasim, down $2/mt from a week ago. Buyers were interested in HMS 1&2 (80:20) at $280-285/mt cfr Port Qasim while offers were only above $290/mt cfr Qasim. Trades for UAE-origin mixed #1 HMS and P&S sarya scrap were reported at $295-300/mt cfr Port Qasim, unchanged from the prior week. Offers of South African scrap jumped by $5-7/mt as the African government intends to lower exports to support the domestic industry by implementing a new pricing system. 


The gap between HMS and shredded narrowed encouraging shredded trades this week. The index for US-origin HMS 1&2 (80:20) settled at $284.83/mt cfr Port Qasim, down by around $5/mt from a week earlier. Most US yards were unwilling to offer large volumes citing expectations of a strong market in October. Offers were at $290-295/mt cfr Port Qasim against bids of not above $280/mt cfr Qasim.


The weekly Davis Indexes for P&S and busheling settled at $313/mt and $333/mt cfr Port Qasim, down by $2/mt and up $1/mt, respectively. Most traders stayed away from deals of premium grade scrap. Bids for P&S scrap dropped to $305-310/mt cfr Port Qasim from Brazil and UAE following the decline in prices for shredded.  


Domestic steel  

Domestic steel prices in Pakistan failed to lift for another week as demand continues to lag. Hopes of demand recovery driven by infra projects initiated by the government in North Pakistan could lift trades next week, though, a sharp recovery is not possible.  

The weekly Davis Index for commercial Bala billet, Thursday, settled at PKR91,050/mt ($551/mt) ex-works Punjab inclusive of local taxes, down PKR75/mt from the prior week. Trades concluded at PKR91,000-91,200/mt ex-works similar to last week. 


The Davis Index for G-60 billet settled at PKR96,250/mt ex-works Punjab, down by PKR125/mt successively for the second week.  

The weekly Davis Index for G-60 rebar settled flat at PKR109,708/mt ($659/mt) ex-works Karachi, up PKR708/mt from last week. Mills canceled discounts on expectations of improving demand as the impact of monsoon has subsided. In Punjab, G-60 rebar prices were PKR109,5000/mt ex-works, unchanged from last week. Local rebar traded at PKR103,000/mt ex-works, on the hand leading rebar steel makers in Karachi held base offer prices stable at PKR111,000-112,000/mt ex-works.


Domestic scrap

Mixed sentiments in the imported scrap market held back trades for domestic scrap in Pakistan. Index for Pure Q toke scrap equivalent to shredded traded at PKR70,500/mt ex-yard Lahore, Friday, flat from late last week. The weekly index for Pure Q Toke (shredded) rose by PKR50/mt to PKR71,300/mt ex-Pakistan yard in line with limited supply.  




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