Containerized imported ferrous scrap offers in Bangladesh were firm, however, buyers kept bids low due to weak domestic steel prices and a ‘stable to down’ trend in Japanese ferrous scrap prices on Wednesday.
Post mid-September, improving cash flows and depleting inventories for ferrous scrap could support restocking of imported materials, believe many sellers, who continue to hold offers.
A few mills showed a willingness to pay a premium over other subcontinental buyers. With Pakistani mills buying shredded at firm prices, sellers could refuse to negotiate at present bid levels. The daily Davis Index for containerized shredded, Wednesday, was flat at $544.25/mt cfr Chattogram. Offers for containerized shredded were at $545-550/mt cfr Chattogram with no trades reported for shredded.
End consumers for ferrous scrap are not benefitting from a drop in international prices due to high freight rates. Despite a decline in ferrous scrap prices in the supplier countries, on cfr basis, equivalent landed prices stay high.
In the bulk market, offers from the US west Coast for equivalent HMS 1&2 (80:20) were unattractive for Chattogram-based buyers.
The daily Davis Index for HMS 1&2 (80:20) from Latin America slipped by $1/mt to $494/mt cfr Chattogram. Brazilian domestic scrap prices dropped, however, amid tight vessel space; sellers found it difficult to transport materials. This resulted in very limited deals. Demand for Latin American origin was weak amid transport delays.
A few offers for West African origin HMS 1&2 (80:20) considered as inferior quality were at $500/mt cfr against bids of $490/mt cfr Chattogram on Wednesday. The daily index for US-origin containerized HMS 1&2 (80:20) was down by $2.5/mt to $506.25/mt cfr Chattogram. The mismatch between offers and bids slowed trading.
The daily Davis index for UK-origin HMS 1&2 (80:20) Wednesday was at $498/mt cfr Chattogram. The daily index for Australian HMS 1&2 (80:20) was at $505/mt cfr Chattogram. Both were down $2/mt from Tuesday.
Trades for #1 HMS from the UK heard traded at $510/mt cfr Chattogram.
In the domestic market, shipbreaking scrap equivalent to P&S traded at BDT50,500/mt ex works, down BDT500/mt from late last week.
Large scale mills are offering discounts of BDT1,500-2,000/mt over listed prices of rebar to encourage sales. AKS, GPH and KSRM offered rebar at BDT71,500/mt ex-works while BSRM at BDT72,000/mt ex-works on Wednesday.