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

A stronger domestic market in the US in December lifted suppliers’ sentiments pushing offers up $5/mt on Thursday. Domestic scrap prices in the US are expected to rise by $15-20/gt from November. Shortage of ferrous scrap and containers are other factors keeping the price outlook strong in Asian markets. In Pakistan, construction activities have gained momentum and boosted rebar trades. 

The daily Davis Index for containerized shredded, Thursday, rose by $1.08/mt to settle at $383.58/mt cfr Port Qasim. Trades for containerized EU/UK-origin shredded heard at $380-382/mt cfr Port Qasim, with offers as high as $385-387/mt cfr Port Qasim on Thursday. A shortage of containers with shipping companies and scrap at yards has kept many suppliers away from the market. Few European suppliers plan to close yards from mid-December till the first week of January on account of the Christmas and New Year holidays. 


The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $367/mt cfr Port Qasim, unchanged from Wednesday. Trades were limited for the grade at $365-367/mt cfr Port Qasim. Traders offered HMS 1&2 (80:20) at prices as high as $365-370/mt cfr Port Qasim citing bullish global markets. Dubai-origin containerized mixed #1 HMS and P&S sarya scrap offers at $370-375/mt cfr Port Qasim, gaining $5/mt from the prior day. 

The index for US-origin HMS 1&2 (80:20), Thursday, settled at $367.93/mt cfr Port Qasim up by $1.05/mt from Wednesday. Most US-yards diverted supplies to fulfil Turkish bulk orders. Finished steel demand is strong in Turkey with the possibility of a further price hike in the coming days.

There were no offers for containerized scrap from South Africa as their International Trade Administration Commission has decided to ban exports of ferrous scrap to support the domestic industry. 

Domestic steel prices up; demand slow 

In the domestic market, Bala billet prices heard at PKR94,200-94,500/mt ($583-587/mt) ex-works Punjab. Rebar makers decided to pass on the increase in input costs to end-users. Finished steel prices rose in Pakistan with the aid of economic packages of PKR1 trillion and PKR100bn announced in Punjab and Khyber Pakhtunkhwa, respectively, for housing and construction projects. Naya Pakistan Housing Programme (NPHP) can potentially create demand for 6-7mn mt of long steel, assuming the government builds 50pc of the promised houses. 

Trades for rebar started recovering in the Southern region and were at PKR114,500-115,000/mt ex-works Karachi. In Punjab, G-60 rebar prices were at PKR113,000-113,500/mt ex-works. Prices rose by PKR2,500-3,000/mt since mid-November. Most mills cancelled discounts on finished steel and are eyeing to increase prices. 



Domestic ferrous scrap prices in Pakistan rose on bullish global cues. On Thursday, prices increased by PKR1,500-2,000/mt from late last week. Prices for Art Q toke scrap equivalent to a mix of HMS and P&S heard at PKR72,500-72,700/mt ex-works Lahore, up PKR800-1,000/mt from Wednesday. Trades for the Pure Q Toke (shredded) heard at PKR74,000-74,500/mt ex-yards with offers moving up to PKR74,500-75,000/mt ex-yards. Pakistan ship recyclers remained active. Recyclers bought scrapped tankers at $370-380/ldt cfr Pakistan this week. 



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