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

US West Coast ferrous scrap dock prices increased in San Francisco but were rangebound in Los Angeles and Portland. 


Japan’s increasing export scrap prices are supporting the alternative US scrap source. Indian mills are expected to begin October bookings soon, which will place further competition in the market. Many countries in Asia are encountering higher domestic scrap prices and tight scrap supplies as fall steel production ticks up with seasonal construction, which will further support import options. 


Higher export scrap prices are meeting deals despite a slowdown on imported ferrous scrap trades. Although some buyers expect corrections at a time when mills are assessing continued weak demand in finished steel, Turkey’s latest deals are supporting upward price expectations.


Concerns over softening export prices eased on Tuesday with Turkey’s latest import scrap deals going public at $283-287.5/mt cfr on HMS 1&2 (80:20). While Turkey does not usually buy from the West Coast, the trades influenced the global barometer due to continued demand in a period of tight scrap inventories. 


The weekly Davis Indexes in Portland remained unchanged with the HMS 1&2 (80:20) flat at $209/gt delivered dockside and P&S 5ft at $222/gt delivered. The index for shredder feed also held at $162/gt delivered despite buyers beginning to offer more to attract inventories. The index incorporates total ranges and lags representing this activity. Given the tight scrap supply and the expected increase in US domestic scrap prices at regional mills, dock prices in Portland could increase next week. 


In San Francisco, the weekly indexes increased with HMS 1&2 (80:20) up by $17/gt to $225/gt delivered, P&S 5ft increasing by $19/gt to $229/gt delivered and shredder again moving up by $10/gt to $151/gt delivered. The West Coast has been affected by fires. Specifically, the San Francisco area is on recommended evacuation in some areas and has limited outside exposure to smoke for employees, which may affect shipments from some scrapyards to the docks. 


Los Angeles’ Davis Indexes remained rangebound with the index for HMS 1&2 (80:20) up by $1/gt to $186/gt while P&S 5ft was unchanged at $203/gt delivered. The shredder feed index increased by $2/gt to $146/gt delivered as docks sought feedstock. 


The containerized market in Los Angeles increased by $10/mt this week as HMS 1&2 (80:20) prices moved from $235-240/mt fas to $245-250/mt fas after having remained flat for two consecutive weeks. Some buyers expected a correction last week, but with stronger iron ore prices and tight global scrap supplies, US export scrap prices gained this week. The scrap shortage on both US coasts has firmed up both bulk and container prices.

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