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

Imported ferrous scrap market in Pakistan was upbeat through the week and gaining each day. Trades picked up sharply following indications of higher scrap prices in the next few days supported by global cues. Finished steel inventories continued to decline and mills raised enquiries to refill scrap inventories. Domestic steel market, however, has not been performing and demand remains weak.  


The daily Davis Index for containerized shredded, Friday, rose by $1.02/mt to settle at $316.75/mt cfr Port Qasim. A deal for 2,000mt UK-origin shredded was heard at $317/mt cfr Qasim on Friday. On Friday, shredded in containers sold at $318-320/mt cfr Qasim as buyers aggressively bought to restock scrap. Suppliers and traders anticipate Pakistan mills could continue restocking as prices are expected to rise further.  


Dubai-origin #1 HMS scrap in containers traded at $312-315/mt cfr Port Qasim. Offers for PNS sarya scrap were at $315/mt cfr Qasim however, buyers were less interested in buying HMS grade as extra taxes are applicable on the grade compared to shredded. The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $306/mt cfr Port Qasim, up by $3/mt from Thursday. Offers from South American ferrous scrap suppliers were at $295-300/mt cfr Qasim. Most Brazilian yards preferred to sell in the domestic markets.  


The index for US-origin HMS 1&2 (80:20) settled at $306.5/mt cfr Port Qasim, up by $1.21/mt from Thursday and up $11/mt from the prior week. The gap between HMS and shredded narrowed encouraging shredded trades this week. A few yards could run short of supply towards December on seasonal issues keeping offers high. Offers for cast iron rotor drums heard at $340-345/mt cfr Pakistan over this week, up $5/mt from the prior week.  


The weekly Davis Indexes for P&S and busheling settled at $320/mt and $333/mt cfr Port Qasim, both up by $7/mt, respectively. Active buying from Indonesian markets for these grades pushed offers up. Some mills in dire need of these grades paid higher price, but most buyers shied away.  


Domestic steel  

Domestic steel prices in Pakistan has been improving, however, at a slower-than-expected pace. Billet prices dropped further on weak demand but rebar offers remained flat. Despite resumption of economic activities, many market participants are facing cash flow challenges.


The weekly Davis Index for commercial Bala billet, Friday, settled at PKR90,000/mt ex-works Punjab inclusive of local taxes, down PKR500/mt from the prior week. Trades concluded at index prices amid indication of a continued downtrend in the coming days. The Davis Index for G-60 billet settled at PKR96,000/mt ex-works Punjab, down by PKR500/mt.  


The weekly Davis Index for G-60 rebar rose to PKR109,500/mt ex-works Karachi, down around PKR1000/mt from last week. Mills cancelled discounts on expectations of improving demand. In Punjab, G-60 rebar prices were PKR109,000-109,500/mt ex-works, unchanged from last week. Local rebar traded at PKR103,000-104,000/mt ex-works.


Domestic scrap

Despite increase in imported ferrous scrap prices, Pakistan’s domestic scrap remained weak in Pakistan. Index for Pure Q toke scrap equivalent to shredded traded at PKR68,750/mt ex-works Lahore, Friday, down PKT1,750/mt from late last week. The weekly index for Pure Q Toke (shredded) dropped by PKR1250/mt to PKR70,000/mt ex-works in line with easing supply.  




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