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

Imported ferrous scrap prices trended up in South Asia on brisk buying activity. Pakistan steel mills continued to book shredded scrap at higher prices in containers, while Indian buyers preferred to book HMS in containers amid short supply of domestic scrap. A few importers remained cautious of a price correction as actual end-user demand remains weak.  


US-based recyclers are offering bulk cargoes at higher prices to South Asia and Southeast Asian buyers, however, buyers are waiting for better clarity on the global scrap prices. Billet and HRC prices remained volatile in Asia. 


In Turkey, US-origin HMS 1&2 (80:20) bulk prices remained flat at $285/mt cfr. Turkish steel producers have slowed down their deep-sea purchases since the long steel market in the country is impacted by the weakening of the Turkish lira. A few buyers are, therefore, waiting for the market to correct in the coming days.  


The Davis Index for containerized shredded Thursday settled flat at $308.30/mt cfr India subcontinent. The index for containerized US-origin HMS 1&2 (80:20) settled at $291.5/mt cfr India subcontinent, up $1.15/mt from Wednesday.  



Indian steel prices remained on an uptrend following a sudden rise in billet prices, which traded at Rs33,000-33,500/mt ex-works Mandi Gobindgarh. Domestic steel demand has gradually improved and major mills to operate at 80-90pc capacity. Domestic ferrous scrap and Sponge iron prices spiked on Monday by Rs1,000-1,500/mt delivered works pushing many mills to resume inquiries for imported scrap.  

The daily Davis Index for containerized shredded settled at $313.63/mt cfr Nhava Sheva, up by $0.96/mt from Wednesday. A few offers for UK/European origin containerized shredded were flat at $314-318/mt cfr Nhava Sheva on Wednesday. Suppliers held offers citing higher bids from other subcontinental markets.

The Davis Index for HMS 1&2 (80:20) of UAE-origin settled at $298.21/mt cfr Nhava Sheva, up by $1.54/mt from Wednesday. UAE suppliers continued to hold offers firm on the expectation of higher bids from Pakistani buyers. Offers for South African and Dubai origin #1 HMS reported at $300-305/mt cfr Mundra while Busheling offers were at $325-330/mt cfr Nhava Sheva.


Several deals for Dubai-origin material were heard at $295-300/mt cfr Nhava Sheva for a shorter delivery period. If the demand remains strong, most mills could book scrap from Dubai in need of quicker deliveries. Surprisingly, the ongoing ban on scrap exports has had minimal impact on trades.  

Offers for US-origin HMS 1&2 (80:20) were at $295-298/mt cfr Nhava Sheva on Thursday. The index for US-origin HMS 1&2 (80:20) settled at $295.83/mt cfr Nhava Sheva, up by $0.4/mt from Wednesday.  

In the ship breaking markets, Indian buyers raised their bids to $340-350/ldt for scrapped tankers and containers to take advantage of the narrowing spreads between rolling and melting scrap.  



Bangladeshi steel mills are likely to accept higher prices for containers after a long break. Mills had bid $10-15/mt lower than current market expectations. Demand for domestic steel is slow for now but is expected to spur in the last quarter of 2020. Some mills in Bangladesh are facing cash flow crunch, while some others are waiting for rains to subside before booking more material.


In Bangladesh, scrapped ship import inquiries picked up pace. Early this week, a recycler sold one car carrier at $317/ldt cfr Chattogram, suppliers are eyeing $320-330/ldt Chattgram as new levels for trades.


The daily Davis Index for containerized shredded settled at $321.83/mt cfr Chattogram, up by $1.83/mt. Offers for shredded from leading UK yards were at $325-327/mt cfr Chattogram on Thursday. Most steel mills in Dhaka remained away from trades at higher levels and sought lower-priced shredded from other supplier countries. These mills are also likely to consider the delivery time before booking scrap. A few trades for Australian shredded heard at $312-315/mt cfr Chattogram.  


The index for Latin America-origin HMS 1&2 (80:20) settled at $302.5/mt cfr Chattogram, up $2.5/mt from Wednesday. A few containers traded at $300-303/mt cfr Chattogram. Offers for #1 HMS from Brazil, Chile, and Europe were at $305/mt cfr Chattogram, with bids at $300/mt cfr Chattogram from small scale furnaces.  

The index for US-origin HMS 1&2 (80:20) was at $305/mt cfr Chattogram, up by $1.07/mt from Wednesday. Sellers held offers for HMS 1&2 (80:20) above $310/mt cfr Chattogram, trades, however, were not reported above $303-305/mt cfr Chattogram.  



Pakistan ferrous scrap importers purchased material only on a need basis. Finished steel prices in the country remained firm on the back of bullish imported scrap prices. Production capacity utilization has reached 100pc. 

The daily Davis Index for containerized shredded settled at $315.13/mt cfr Port Qasim, up by $1.02/mt. Trades for the US and Europe-origin shredded were at $312-314/mt cfr Port Qasim. A few trades for UK-origin material concluded at $317-318/mt cfr Port Qasim. Offers by UK suppliers for the grade were at $318-320/mt cfr Port Qasim on Thursday. With sellers unwilling to lower offers, buyers had no choice but to raise their bids. 

Around 5,000mt of European shredded traded at $310-312/mt cfr Port Qasim. 

The price gap between imported shredded and domestic shredded has broadened to $20-25/mt from $10-15/mt earlier. Many buyers are expecting a slight fall in scrap prices after mid-August. Buyers preferred shredded over HMS 1&2 (80:20) for the duty and quality advantages it offers. 

The country’s prime minister has announced new schemes that are expected to push infrastructure projects in the country. In the domestic market, Bala billet prices were at PKR92,500/mt and G-60 billet at PKR97,000/mt ex-works Punjab. Semi-finished steel prices have been rangebound for around two weeks. 

The Davis Index for HMS 1&2 (80:20) of UAE-origin settled at $304.29/mt cfr Port Qasim, up by $1.29/mt from Wednesday. Trades for UAE-origin mixed #1 HMS and P&S were at $305-310/mt cfr Port Qasim. Most UAE suppliers have managed to stay in the market despite an official ban on exports. 

The index for US-origin HMS 1&2 (80:20) settled at $298.93/mt cfr Port Qasim, up by $1.43/mt from Wednesday. Most US yards offered material at $300-305/mt cfr Port Qasim. A few trades were reported at $295-298/mt cfr Port Qasim as mills anticipate steel demand to strengthen in the coming days.


($1=Rs74.84; PKR168.28; BDT84.92)


Leave a Reply

Your email address will not be published.