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

Asian ferrous scrap markets were bullish after a rise in Kanto tender bids for Japanese scrap. A steady recovery in steel demand and higher iron ore prices are supporting high scrap offers in the region.   



In Taiwan, ferrous scrap offers were bullish this week in line with higher bids placed for Japan’s Kanto scrap tenders. The daily Davis Index for containerized US-origin HMS 1&2 (80:20) rose by $3/mt to $264/mt cfr Taiwan from Wednesday and up by $6/mt from the week prior. Importers are booking limited volumes of scrap as offers have moved up despite subdued demand for finished steel 


Reduce scrap trades in Turkey could make Taiwanese mills a preferred destination for the US origin scrap amid a rise in Japanese scrap prices, said importers. The daily Davis Index for HMS 1&2 (80:20) fell by $1.25/mt to $282.50/mt cfr Turkey on Wednesday from a day prior. Also, a shortage of domestic ferrous scrap could turn sellers attention to Taiwan, said local traders. Limited trades for US-origin HMS 1&2 (80:20) were heard at $260-263/mt cfr on Thursday.


The weekly Davis index for containerized #1 busheling and P&S 5ft settled at $293/mt cfr and $288/mt cfr Taiwan, up by $9/mt and $6/mt, respectively. No deals were heard this week. The index for weekly shredded settled at $280/mt cfr Taiwan, up by $5/mt from the week prior and $10/mt from Aug 6, on higher offers, but no trades were heard. Deals for #1 HMS from South America were heard at $273/mt on Monday.


No bulk deals to Taiwan were heard this week with manufacturers waiting to see how suppliers and importers react to the Kanto tender prices.


Taiwanese steelmaker Feng Hsin Steel raised rebar prices by NT$300/mt ($10.19/mt) to NT$14,500-14,700/mt on Thursday. The steelmaker was forced to raise price amid higher input costs.



In the containers market, the weekly index for HMS1&2 (80:20) rose by $6/mt to $271/mt cfr Vietnam and up by $12/mt from Aug 6. The weekly index for #1 busheling fell by $3/mt to $300/mt cfr on lower demand for high-grade ferrous scrap, while the index for shredded rose by $3/mt to $286/mt cfr. Vietnam has had limited containerised ferrous scrap trades in the last four weeks due to a rise in COVID-19 infections. Vietnamese mills booked US-origin HMS1&2 (80:20) at $270/mt on Friday, while offers rose by $5/mt on Thursday.


In the bulk market, importers delayed new bookings to gauge market direction post-Kanto tender. A deal for US-origin HMS 1&2 (80:20) was heard at $301/mt cfr early in the week. Shortage of domestic scrap and expected high demand for finished steel in September could drive scrap bookings, said mill owners. For August, the demand scenario looks bleak on the back of increasing COVID-19 infections. 



Mills ramped up production in Indonesia with some major infrastructure projects scheduled to commence in September. Amid a shortage of domestic ferrous scrap, mills sought imported material. 


The weekly Davis Index for HMS 1&2(80:20) rose by $13/mt to $288/mt cfr Jakarta due to rise in offer prices after Japanese Kanto tender bids. Trades for containerized HMS 1&2(70:30) from Malaysia were heard at $290/mt cfr. The weekly index for shredded rose by $7/mt from the prior week to $295/mt cfr Jakarta, while it increased by $14/mt from Aug 6.


The index for #1 Busheling fell $2/mt this week due to deals at $315/mt cfr heard before Kanto tender. The index settled at the same level. The index for P&S 5ft fell by $3/mt to $304/mt cfr on lower bids at $300/mt. Market participants sought ferrous scrap from US-based suppliers, who have lower offers due to the softening of markets in Turkey and India. 



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