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

Importers from Pakistan bought ferrous scrap only on a need basis, with mills adopting a just-in-time inventory strategy. Bullish offer prices have made imports unviable. This, mainly since rebar demand has failed to pick up as expected in the country. A few HRC makers, however, have raised prices in line with a healthy China market. 


An uncertainty amid the resurgence of COVID-19 in most supplier countries has hampered logistics due to movement restrictions. A possibility of domestic scrap prices increasing by $20-40/gt in the US in December kept suppliers bullish. 


The Davis Index for containerized shredded, Thursday, rose by $2.61/mt to $359.04/mt cfr Port Qasim. Some trades for containerized EU and UK-origin shredded were reported at $355-360/mt cfr Port Qasim. Most US suppliers refused to place fresh offers due to depleting stocks and lowered collection rates with the winter season is set to arrive. A few shredded offers were at $365/mt cfr Port Qasim on Thursday, almost hitting a two-year high.  


Mills were offered bulk cargoes of HMS 1&2 (80:20) from the US at $330/mt cfr Turkey, which may rise further. Prices might gain another $20-30/mt in December and January, said a trader. 


The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $342/mt cfr Port Qasim, up by $3/mt from Wednesday. 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 $345-350/mt cfr Port Qasim. Dubai-based suppliers preferred Indian buyers where domestic demand and prices are higher than in Pakistan. 


The index for US-origin HMS 1&2 (80:20), Thursday, settled at $340/mt cfr Port Qasim, up by $1.79/mt from Wednesday. Most European supplier countries are under lockdown amid the rising tally of COVID-19 infections. Containerized offers for the grade from the US and UK were limited in anticipation of a bullish December market. 


Rebar prices fail to rise

Domestic scrap rose on the back of a rise in imported scrap. Rebar sales, however, still are slow. Mills have been unable to raise steel prices since demand remains under pressure. Bala billet prices were at PKR91,800-92,000/mt ($581-584/mt) ex-works Punjab. Offers for rebar from leading Karachi producers were unchanged from the prior week at PKR109,500-110,000/mt ex-works. In Punjab, mills kept their G-60 rebar offers at prices above PKR109,000-109,500/mt ex-works. After an initial increase, offers for domestic Pure Q toke scrap equivalent to shredded were unchanged at PKR71,000-71,500/mt del Lahore mill.




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