Bangladeshi mills continued bookings of imported scrap ahead of the Eid holidays. However, requirements from small and medium-scale mills have dropped significantly amid weak steel sales. Domestic steel demand has slumped due to heavy rains and a nationwide COVID-19-related lockdown for more than a month.
The government has eased restrictions effective July 14, until July 23 ahead of Eid-al-Adha. There would be another stringent lockdown for two weeks starting July 23 with the closures of all government, semi-government, autonomous and private offices in addition to travel and transport restrictions.
A shortage of domestic scrap due to a decline in demolition work forced mills to pay high for imported scrap despite margin squeeze.
The daily Davis Index for containerized shredded on Wednesday settled unchanged at $555/mt cfr Chattogram. Deals were scarce due to a wide gap between offers and bids. Mills in Bangladesh are hoping for a drop of $9-10/mt in containerized prices, similar to a drop seen in the Turkish bulk market. However, sellers were unwilling to lower prices citing improving demand.
The daily Davis Index for HMS 1&2 (80:20) from Latin America, Wednesday, at $521/mt cfr Chattogram, up by $1/mt. Yards raised offers by $5-10/mt citing improved demand and limited supply.
In a recent containerized deal, a Dhaka-based mill bought UAE-origin #1 HMS at $545/mt cfr Chattogram. Mills sought scrap from UAE to fulfill immediate demand amid the domestic supply crunch.
Following elevated offers, the daily indexes for US-origin containerized HMS 1&2 (80:20), Wednesday, rose by around $1.25/mt to $533.75/mt cfr Chattogram. The daily indexes for UK-origin and Australia-origin HMS 1&2 (80:20) settled at $521/mt and $529/mt cfr Chattogram, up $1/mt.
The domestic steel market remains muted. Rebar trades are yet to recover. Billet and rebar prices remained at BDT59,500-60,000/mt and BDT71,500-72,000/mt ex-works.
Offers for ship scrap equivalent to P&S were at BDT49,500-50,000/mt ex-yards.
For shipbreakers, scrapped vessel offers remained at $580-600/ldt levels pushing up ship scrap prices. Ship plate offers were at BDT55,000/mt ex-yards.