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

Pakistan’s imported scrap market continued to be silent with most mills exercising caution while restocking material. Especially as the domestic steel prices, particularly that for billets, registered a slow rise.  

Major rebar makers in southern Pakistan, including Amreli Steel, have decided to hold sales citing highly volatile prices. The time frame for this stoppage is undecided. Most participants believe it could be two to three weeks before the sales resume. Expectations of bullish global cues failed to lift sentiment in the country. 


The Davis Index for containerized shredded, Monday, rose by $3.51/mt from Friday to settle at $441.43/mt cfr Port Qasim. A couple of deals, for around 500mt of scrap each, were reported at $440-445/mt cfr Port Qasim. Mills with low to no inventories for production opted for these deals. 

Sellers largely preferred to stay away from doling out offers, but those who offered,  quote no less than $445-460/mt cfr Port Qasim for shredded. Buyers refrained from purchases at these prices. A few sellers in the EU/UK shut yards earlier and than scheduled for new year holidays, as the new highly-contagious COVID-19 strain has started spreading in the region. They might return only after the first week of January. 

The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $423/mt cfr Port Qasim, up by $7/mt from Friday. Dubai suppliers anticipate a further rise in inquiries for HMS scrap as suppliers are only a handful in the market from other regions. Rebar prices in the UAE firmed up, spurring demand for domestic scrap. 


Offers for Dubai-origin containerized mixed #1 HMS and P&S sarya were above $425/mt cfr Port Qasim, forcing many mills to step back. Harsh winter in parts of rural Pakistan has halted construction. Large infrastructure projects catered to by leading steelmakers are witnessing cash flow issues. Except for Karachi, winter in all other regions has impacted transportation.   


The index for US-origin HMS 1&2 (80:20), Monday, settled at $423.75/mt cfr Port Qasim, up by $8.25/mt from Friday. Many US suppliers focused on the bulk demand in Turkey. A few offered material to buyers in East Asia, where present price levels found better acceptability than in South Asia.


Billet prices on a slow recovery 

In the domestic market, Bala billet prices were mixed amid limited trades. In Punjab, prices on Monday showed only a marginal rise to PKR93,000-94,000/mt ($581-587/mt) ex-works. Many re-rollers and traders offered discounts to encourage sales, causing billet prices to largely trend sideways. Steel demand remains unsupportive for production ramp-ups. Rather, many small mills could opt for production cuts in winter. 

In Karachi, citing high volatility in the international scrap markets and skyrocketing prices, Amreli Steels has paused sales nationwide for deformed and Xtreme rebars in all sizes from Dec 19, 2020. Asking rates for these products before the mill stopped accepting bookings were at PKR122,000-123,000/mt ($762-768/mt) ex-works, but failed to encourage trades. 

In the southern region, rebar prices increased but are at prices below the offers from major mills. Rebar traded at PKR117,000-120,000/mt ex-works Karachi, depending on quality. In Punjab, G-60 rebar prices heard at PKR116,000-117,000/mt ex-works.


Domestic scrap

Prices for Art Q toke scrap equivalent to a mix of HMS and P&S were flat on Monday at PKR74,200-74,500/mt ex-works Lahore. Trades for the Pure Q Toke (shredded) were at prices unchanged- PKR75,000-75,500/mt ($457-461/mt) ex-yards, with offers above PKR75,500-76,000/mt ex-yards on Monday. For shipbreakers, scrapped tankers and container offers were at $420-430/ldt cfr Pakistan.




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