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

There were limited trades for imported ferrous scrap in Pakistan on Tuesday. Buyers largely stayed away from restocking material due to heavy winters and record-high imported scrap prices. Despite bullish global cues, sentiment in the country was negative. Only those in dire need of material opted for minimal-volume trades to keep their operations running.  


The Davis Index for containerized shredded, Tuesday, jumped by $13.57/mt from Monday to settle at $455/mt cfr Port Qasim. A couple of deals for around 1,000mt of scrap each, were reported at $445/mt and $450/mt cfr Port Qasim on Monday. While offers on Tuesday were above $455-465/mt cfr Port Qasim. Though inventory with a few leading steelmakers is depleting, they hesitated to book material amid weak domestic demand and global uncertainties. 


On Tuesday, Busheling bundles sold at $475/mt cfr Qasim and 1,000mt of 4a/4c grade bundles of UK origin sold at $470/mt cfr Qasim.


Global iron ore prices declined on Tuesday after reaching $175/mt cfr China for 62pc Fe content. The fear of the highly contagious COVID-19 strain spreading further has resulted in lockdowns, and impacted market sentiment. 

Yards are shut for holidays and trades could be limited until the first week of January at the minimum. 

The Davis Index for UAE-origin HMS 1&2 (80:20) settled at $438/mt cfr Port Qasim, up by $15/mt from Monday. Offers have increased by $15-20/mt in the past couple of days. Rebar prices in the UAE firmed up, spurring demand for domestic scrap. Rising domestic scrap consumption resulted in limited offers for HMS in overseas markets. 


Offers for Dubai-origin containerized mixed #1 HMS and P&S sarya were above $435-450/mt cfr Port Qasim on Tuesday, 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) settled at $437.5/mt cfr Port Qasim, up by $13.75/mt from Monday. Many US suppliers focused on the bulk demand in Turkey. A few offered materials to buyers in East Asia, where present price levels found better acceptability than in South Asia.

Finished flat prices in the country are bullish. HRC prices jumped by PKR5,500-6,000/mt from price levels for last heard trades. A major mill raised HRC and CRC prices by PKR5,500-6,000/mt to PKR162,000-164,000/mt ex-works. 


Billet prices register slow recovery 

In the domestic market, Bala billet prices showed a marginal rise to PKR93,500-94,000/mt ($581-587/mt) ex-works. Overall finished 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, many major mills have paused sales nationwide. Asking rates for rebar before the mill stopped accepting bookings were at PKR122,000-123,000/mt ($760-767/mt) ex-works but failed to encourage trades. 

Following the rising trend in the South, in the northern region, rebar prices increased, but are below asking prices quoted by major mills. Rebar traded at PKR118,000-120,000/mt ex-works, 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 was on a gradual uptrend with prices at PKR74,500-75,000/mt ex-yards Lahore. Trades for the Pure Q Toke (shredded) rose to PKR75,500-76,000/mt ($470-473/mt) ex-yards, with offers above PKR76,000/mt ex-yards on Tuesday. 




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