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

US containerized ferrous scrap continued mostly rangebound on the West Coast but declined on the East Coast. The Los Angeles area made limited gains as prices ticked up across all grades, but San Francisco and Seattle remained rangebound, absorbing small losses in some trades this week.  


The New York weekly Davis Index faced declines after achieving gains in the prior week. The #1 busheling index fell by $4/mt to $494/mt fas, canceling the rise of $5/mt last week. P&S 5ft and shredded declined by $6/mt and $5/mt to $472/mt fas and $468/mt fas, respectively. HMS 1&2 (80:20) and turnings declined the most by $12/mt and $11/mt to $431/mt fas and $387/mt fas, respectively. Several buyers, especially, with destinations to India and Pakistan reported a sharp decline in buying prices in fas terms on these two grades this week.  


Import offers are facing low user demand in India with some regions experiencing lower domestic scrap prices as others have begun to increase on limited supplies. This is also the case with sponge iron where some regions are facing price erosion, some are unchanged and others are beginning to rise. 


Buyers from Pakistan, Bangladesh, and India are relatively muted and sellers continue with expectations of a returned surge in scrap interest after the lockdown, holding prices above bidding levels.  


The weekly Los Angeles Davis Indexes ticked up in the midst of declining containers off the East Coast and lower bids on US domestic scrap during the early September trading week. The index for #1 busheling was unchanged at $435/mt fas and shredded decreased by $2/mt to $428/mt fas. P&S 5ft trended unchanged at $427/mt fas again while HMS 1&2 (80:20) grew by $4/mt to $399/mt fas with some reporting deals slightly over $400/mt fas. Low container availability, port backlogs, and high freight prices continue to plague the containerized market. 


Japan’s Tokyo Steel reduced domestic ferrous scrap prices at one plant while maintaining other locations as unchanged. The market is showing uncertainty due to various lockdowns in Asia including Japan, due to COVID-19 pandemic concerns.


The San Francisco Davis Indexes for #1 busheling, P&S 5ft and shredded remained unchanged at $428/mt fas $421/mt fas and $421/mt fas, respectively. HMS 1&2 (80:20) declined slightly by $2/mt to $388/mt fas.


In Seattle, the Davis Index for #1 busheling continued flat at $421/mt fas as HMS 1&2 (80:20) dipped by $1/mt to $384/mt fas. Shredded and P&S 5ft was unchanged at $418/mt fas.


The US-origin HMS 1&2 (80:20) index dropped by $4.75/mt this week to $445.75/mt cfr Turkey on Thursday from $450.50/mt cfr on Aug 26. The index had recorded a loss of $4.38/mt last week. 


September ferrous trading in the US, which began today has dampened prices on both coasts. On the East Coast secondary grades such as P&S 5ft and shredded are heard down by $25-30/gt against August settled prices in initial bids. On the West Coast, mills are heard negotiating on the same grades at prices down $10-20/gt against August settled prices. 


The oversupply on the East Coast on limited export activity has dampened prices both in containers and bulk. West Coast sellers are noting a continued interest from some northern Mexican mills seeking imported ferrous scrap, though with the advent of lower prices in Texas and the Southwest the higher prices willing to be paid by Mexican firms, in some cases $10-20/mt above Asian buyers, are under pressure. 

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