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

Prices for containers of imported ferrous scrap shipped to South Korea rose amid a global shortage. Demand, however, is still under pressure as mills opted for domestic material, prices for which were lower than imported scrap.


The weekly Davis Index for containerized HMS 1&2 (80:20), Wednesday, settled at $314/mt cfr South Korea, up by $11/mt, with limited or no deals heard. Offers were at $315-320/mt cfr this week. Offers for US-origin HMS 1&2 (80:20) in FEUs, were at $320/mt cfr, while bids were at $310/mt cfr.


The weekly Davis Indexes for P&S 5ft, #1 HMS, and shredded rose by $11/mt, $12/mt, and $14/mt to $345/mt, $320/mt, and $333/mt cfr South Korea, respectively.  


A deal for 50,000mt Russian A3 scrap was heard at $358/mt, at price level which was up by $30/mt from the prior deal. Bids for Japanese #2 HMS were at 34,500/mt fob, with the likelihood of it rising to JPY35,500-36,000/mt fob next week.


South American suppliers offered HMS 1&2 (80:20) at $310/mt cfr South Korea on Wednesday, at prices up by $10/mt from the prior week.


With firm demand for billets in China, mills in Korea increased production, hoping to raise exports. Billet export offers from exporters in Southeast Asia were above $520/mt cfr China, up by $20/mt from the prior week, as they tried to fill in the void left by many Indian sellers staying away. Domestic demand for billets in India is bullish and mills thus focussed on selling in their own country.


Billets made through induction furnaces in Vietnam were offered at $500/mt cfr Manila at the start of the week.

The HRC market has also strengthened this week supported by demand from the auto sector. Sellers offered HRC at $550/mt fob South Korea, while the Chinese mill was doling out offers at prices equivalent to $590/mt fob and rolling HRC at $610/mt fob China. Some Indian exporters were offering billets at $480/mt fob this week, with offers subsequently rising $500/mt fob.


Mills were expected to reduce domestic scrap purchase prices by KRW10,000/mt ($9/mt) delivered Pohang last week, but refrained from such cuts looking at bullish Japanese and US offers.



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