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

Indian imported ferrous scrap prices were flat to up on Thursday, depending on grade. Scrap importers are upbeat as the Indian rupee gains against the US dollar and mills ramp up steel production. A few mills are selling their finished stock at deep discounts to maintain cash flow. Some trades for HMS were reported while buyers of shredded scrap were taking a cautious approach. 


In Turkey, the daily US-origin HMS 1&2 (80:20) Thursday settled at $302.4/mt cfr Turkey, up $0.2/mt from Wednesday. Mills remained optimistic of billet and rebar demand and anticipate bulk cargoes trades of upto 1mn mt for November deliveries.


The daily Davis Index for containerized shredded on Thursday inched up $1/mt to $325/mt cfr Nhava Sheva. UK-origin containerized shredded were offered at $325-330/mt cfr Nhava Sheva and Mundra. With scrap trending up in global markets, most traders refused to offer material at lower levels. Mills preferred domestic scrap to control costs. 


Few suppliers offered US-origin shredded amid higher realizations in their domestic markets. Very few trades for shredded were reported at $320-322/mt cfr Nhava Sheva. Major steel mills are operating at almost 100pc capacity and this has created a shortage of raw materials in many regions. Sponge iron availability remained scarce forcing buyers to book inferior quality imported HMS scrap from South America and West Africa despite contaminants such as cast iron and galvanized iron. 


Billet export offers stay bullish

Indian billet export offers strengthened to $455/mt cfr Southeast Asian buyers on Thursday in line with rising offers from Iran and CIS suppliers. Iranian exporters sold slab at $430-435/mt fob and billet at $405-410/mt fob Iran, equivalent to $450/mt cfr Thailand, as per Davis sources.


In the domestic market, ingot and billet prices remained under pressure on weak demand. In most regions, billet and ingot prices continued to decline by Rs200-400/mt on Thursday.  


EAF makers face supply crunch 

In Maharashtra’s EAF hub Jalna, mills are maintaining their production levels at 80pc despite weak demand to take advantage of cheaper power tariffs. However, in central and western regions small scale mills are still operating at lower production rates. 


Major steelmakers in the country are offering steel at higher prices and are in a position to pay high for domestic scrap. This creates an upper hand for leading mills. Scale and medium scales EAF and induction furnaces have become non-competitive in the market. Shortage of scrap at cheaper levels is resulting in heavy losses for the secondary industry as they are unable to maintain their cash flows. 


The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $307.73/mt cfr Nhava Sheva Thursday, up by $0.23/mt from Wednesday. Deals for Dubai-origin HMS 1&2 (80:20) were at $308/mt cfr Nhava Sheva. Suppliers refused to accept lower bids of $300-302/mt cfr Nhava Sheva. #1 HMS scrap from Dubai yard was at $308-310/mt cfr Nhava Sheva.


The index for US-origin HMS 1&2 (80:20) Thursday settled at $308/mt cfr Nhava Sheva, unchanged from Wednesday. Most US supplier yards have diverted their attention to Taiwan and Turkey markets where bids are higher than South Asia. A few trades of US and UK-origins HMS materialised in Bangladesh pushed up offers.



The Davis Index for containerized shredded, Thursday, settled at $317.4/mt cfr India subcontinent, up $2.3/mt from Wednesday. The daily Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $300.3/mt cfr India subcontinental, unchanged from Wednesday.




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