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

Domestic steel prices in Pakistan reported a surge of PKR3,500-5,000/mt ($22-31/mt) in a span of five days. The price hike is primarily driven by high international prices amid a steady recovery in domestic demand. Trades took a short pause as most suppliers are away for the winter break and yards are expected to reopen after Jan 4, 2021. Harsh winter in some regions has also affected transportation and overall operations of some mills. 


The Davis Index for containerized shredded, Tuesday, rose by $2.10/mt from Thursday to settle at $465.23/mt cfr Port Qasim.  A deal for 500mt of EU/UK-origin containerised shredded heard at $466-467/mt cfr Qasim with offers of $470-475/mt cfr Qasim. Amid lowering scrap inventories and strengthening domestic steel prices, trades for imported scrap are expected to pick up in the coming days.


In Turkey, domestic ferrous scrap prices came under pressure on currency appreciation. A few mills lowered domestic scrap purchase prices by TRY25-55/mt ($3-7/mt). Global sentiments remain mixed with the spread of a new strain of COVID-19 in Europe and rising concerns of cash flow at such high prices.  


Few Dubai-based suppliers have active offers as most chose to cater to the domestic market. The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $448/mt cfr Port Qasim, unchanged from Monday. Offers heard above $450-460/mt cfr Port Qasim for containers of mixed #1 HMS and P&S sarya.  


The index for US-origin HMS 1&2 (80:20) settled at $450.75/mt cfr Port Qasim, up by $2.89/mt from Monday. US suppliers focused on the bulk demand from Turkey while a few offered materials to buyers in East Asia. In Europe, lockdowns due to a new strain of COVID-19 have hurt market sentiment, turning buyers cautious and keeping them away from large-volume trades.  


Billet and domestic scrap prices rise

On Tuesday, domestic bala billet prices increased by PKR1,000-1,500/mt from a day prior to PKR103,000-104,000/mt ($641-648/mt) ex-works. CC billet offers could exceed PKR110,000/mt ex-works hitting multiyear high, said a trader.  


In Karachi, citing high volatility in the international scrap markets, many major mills have paused domestic sales. A major mill in the South hiked prices by PKR4,000-5,000/mt from Dec 23. Rebar asking prices in the South were at PKR128,000-130,000/mt ex-works. In Punjab, G-60 rebar offers were at PKR124,000-125,000/mt ex-works on Tuesday.


Domestic scrap

Following strengthening global cues, domestic scrap prices rose PKR2,000-2,500/mt in the last two days. Prices for Art Q toke scrap equivalent to a mix of HMS and P&S were at PKR82,000-82,500/mt ex-yards Lahore on Tuesday. Prices Pure Q Toke (shredded) were firm at PKR83,500-84,500/mt ($520-526/mt) ex-yards. This could give imported scrap trades an impetus in Pakistan after a month-long hiatus. In the shipbreaking market, offers for scrapped tankers heard at $450/ldt cfr Pakistan.


Pakistan’s Cabinet Committee on Privatization (CCoP) has approved the transaction structure for the stake sale of the troubled state-owned Pakistan Steel Mills (PSM). The Pakistani government is keen to revive PSM through the publicprivate partnership route.  




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