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

Overseas suppliers kept their offers for ferrous scrap firm despite subdued finished steel demand in the Pakistani market. Although mega infrastructure projects have resumed, the pace of work is still slow, and rebar prices have remained flat for over one and half months. This non-recovery in steel demand, along with limited cash flow, has impacted trades for imported scrap. 


The Davis Index for containerized shredded, Tuesday, moved up by $1.83/mt to $332.5/mt cfr Port Qasim. Trades for containerized EU and UK-origin shredded were at $332-333/mt cfr Port Qasim, prices which were marginally up from Friday. Most offers from the EU and UK were at $335-337/mt cfr Port Qasim, reaching a 17-month peak. 

Trades at prices above $335/mt cfr Port Qasim for shredded have become unviable for Pakistani buyers. Sustaining in the markets, where input costs are on an uptrend while steel demand is failing to pick up, has become a challenge for most. 


The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $323/mt cfr Port Qasim, up by $3/mt from Monday. Mills preferred shredded over HMS scrap to avoid paying extra taxes imposed on the imports of the latter. Offers for containerized Dubai-origin mixed #1 HMS and P&S sarya scrap were at prices above $325/mt cfr Port Qasim on Tuesday. The index for US-origin HMS 1&2 (80:20) settled at $321.43/mt cfr Port Qasim, up by $0.25/mt from Monday. Offers for the grade from the US and UK were at prices above $320-325/mt cfr Port Qasim.


Domestic steel trends flat 

In the domestic market, Bala billet prices were at PKR91,000-91,500/mt ($573-577/mt) ex-works Punjab. Offers from leading Karachi producers for rebar were unchanged from the prior week at PKR109,500-110,000/mt ex-works. In Punjab, mills kept their G-60 rebar offers above PKR109,000-109,500/mt ex-works. Domestic Pure Q toke scrap, equivalent to shredded sold at PKR69,800-70,000/mt del Lahore mill, prices which were flat from Monday.


Pakistani recyclers bought vessels actively after a long gap last week. This week’s offers for scrapped container ships and tankers were flat at $360-370/ldt cfr Pakistan in the Gadani market. 


With the reduction in the power tariffs announced by the government, input costs for mills could reduce and have an impact on rebar offers. The Pakistan Association of Large Steel Producers (PALSP) has hailed such a reduction in power tariffs for businesses under the Small and Medium Enterprises category. 





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