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

Pakistani buyers lowered bids as ferrous scrap prices have started dropping from last Wednesday. Few mills cut bids citing a downtrend in domestic billet and scrap prices amid slow sales. Some leading yards, on the other hand, kept offers firm citing container shortage and limited scrap generation due to COVID-19 restrictions, while many are still away from the market.  


The daily Davis Index for containerized shredded, Monday, settled at $469.06/mt cfr Port Qasim, down sharply $19/mt from Friday’s close. Last week, mills booked a couple of distressed sales at $465-468/mt cfr Qasim for shredded in containers. On Monday, offers from the UK/EU and the US heard at $470-475/mt cfr Qasim.


There is room for a drop in prices as most mills refused to bid on Monday, said traders. If buyers resist offers for longer, some downside is likely in the coming days. Major yards, however, did not accept lower bids, citing that the drop could be temporary, and global cues still favour an uptick in prices.  


The daily index for US-origin HMS 1&2 (80:20) settled at $442.14/mt cfr Port Qasim, down $9.11/mt from Friday in the absence of major deals. In Turkey, bulk prices were under pressure. Mills stayed away or bid at $460-465/mt cfr Turkey and below $450/mt cfr for short sea cargoes.  


Suppliers from UAE offered #1 HMS at $445-450/mt cfr Port Qasim. The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $438/mt cfr Port Qasim down $7/mt from Friday. A few Dubai-based yards focused on strong demand from domestic rebar makers, however, those with limited stocking options are under pressure to liquidate materials. With Indian mills bidding $15-20/mt below current offers and Pakistani mills avoiding HMS deals due to additional taxes on the grade, yards in Dubai are left with little choice.  


Bala below PKR100,000/mt  

A few Pakistani mills have started offering discounts on steel products after quoting record high prices in the first half of January. Billet prices dropped amid harsh winter and slow down in domestic activities. Domestic Bala billet was at PKR98,000-99,000/mt ex-works Lahore, down PKR2,000-3,000/mt from Friday.


In Karachi, major rebar makers kept their asking rates stable but offered discounts to stimulate trades. Mills are offering G-60 rebar 12-32mm at PKR135,000-140,000/mt ($840-872/mt) ex-works.  


Domestic scrap plunges 

On Monday, local Art Q toke scrap equivalent to a mix of HMS and P&S offered at PKR81,500-82,000/mt ex-yard Lahore lower by PKR1,500-2,000/mt from Friday. Pure Q Toke (shredded) traded at PKR83,500-84,000/mt ex-yards, down PKR1,500-2,000/mt from Friday. In the shipbreaking market, offers for scrapped vessels fell by $10-20/mt to $420-430/ldt.




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