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

Imported ferrous scrap prices in South Asia declined on Monday, following global cues. Turkish bulk ferrous scrap prices dropped late last week and the index for US-origin HMS1&2 (80:20) settled at $260/mt cfr Turkey on Friday, down by $3.5/mt from the day prior. US suppliers lowered their offers as scrap supply eased and July shipment prices for finished steel reduced in their domestic market. 



Bangladeshi steel mills resumed bookings of bulk cargoes this week. On Friday, a major steelmaker in Chattogram opted for bulk trade expecting finished steel demand to recover gradually. With the mill ramping up production, inventories at hand have started dipping. 

The steelmaker booked 37,000mt mixed scrap from a US West Coast supplier, comprising of 13,000mt HMS 1&2 (80:20) at $275/mt cfr Chattogram and 24,000mt shredded at $280/mt cfr Chattogram. 

Bulk ferrous scrap prices have dropped by $15-20/mt from offers heard in the mid-June when Turkish bulk ferrous scrap prices hit a three- month high. 

Another steelmaker was said to have booked 10,000mt Japanese bulk cargo comprising of 7,000mt shredded and 3000mt HS scrap equivalent to P&S at an average price of $300/mt cfr Chattogram. 

The Davis Index for containerised shredded settled at $290/mt cfr Chattogram, down by $5/mt from Friday. A few bids from mills were at $280-285/mt cfr Chattogram, on Monday. Buyers were in search of lower offers from Australia, New Zealand, Brazil compared to $290-295/mt cfr Chattogram from Europe and the UK yards. 

The index for Latin America-origin HMS 1&2 (80:20) fell by $8/mt to $263/mt cfr Chattogram. Offers for Brazilian HMS 1&2 (80:20) were in the range of $260-265/mt cfr Chattogram. 

The index for US-origin HMS 1&2 (80:20) settled at $273/mt cfr Chattogram, down by $7/mt from Friday. Steel mills lowered their bids for material from the US amid availability of lower-priced containerised HMS 1&2 (80:20) from New Zealand which traded at $282-283/mt cfr Chattogram.



Indian steel mills continued to face weak demand for finished steel in the domestic market. They instead opted for domestic scrap and sponge iron priced lower than imported scrap. A few buyers are waiting for prices to fall before booking material. Indian currency Rupee continues to remain above Rs76 against US$ 1 from around Rs75.40 early this month keeping importers cautious. 

Domestic ferrous scrap prices in India have dropped by Rs1,000/mt in the last few days to Rs19,000/mt delivered mill amid a sharp drop in rebar demand. In just a week, rebar prices declined by Rs2,500-3,000/mt ex-works, with a ripple effect on domestic scrap bids. Inventories of rebar are piling up with downstream demand remaining hit. 

The daily Davis Index for containerised shredded settled at $275/mt cfr Nhava Sheva, down by $3/mt. Offers were at $280-285/mt cfr Nhava Sheva for material from the UK and Europe. But there were no bids from steelmakers. 

The Davis Index for UAE-origin containerised HMS 1&2 (80:20) settled at $258/mt cfr Nhava Sheva, down by $7/mt from Friday. Buyers stayed away from UAE-origin scrap as the middle eastern country has announced a ban on ferrous scrap exports for four months. 

The index for US-origin HMS 1&2 (80:20) settled at $255/mt cfr Nhava Sheva, down by $10/mt from Friday. Brazilian and West African HMS 1&2 (80:20) in containers traded at $240-245/mt cfr Nhava Sheva, down by $10/mt from the prior week on increased supply. 



Pakistan ferrous scrap importers continued to book ferrous scrap in containers as per their requirement. Trades were thin amid uncertainty in the market caused by rising COVID-19 cases in the major steel-producing regions. The government has announced a 20-day smart lockdown restricting movement in Lahore. The number of cases predicted to reach their peak in July and hurting market sentiment. 

The Davis Index for US-origin containerized shredded settled at $281/mt cfr Port Qasim, down by $4/mt from Friday. Thin trades were heard at $280-285/mt cfr Qasim late last week. Offers were at $285/mt cfr Qasim from suppliers in the UK and Europe. Mills and traders are, however, not keen on these levels.  

The Davis Index for HMS 1&2 (80:20) of UAE-origin settled at $263/mt cfr Qasim, down by $5/mt from Friday.

The index for US-origin HMS 1&2 (80:20) was at $263/mt cfr Qasim, down by $5/mt from Friday. A few offers were at $265-270/mt cfr Qasim with bids below $260/mt cfr Qasim on Monday. 

Pakistan’s ship recycling sector witnessed a positive impact of a reduction in scrap import duties announced in the national budget. Income tax for importers has been reduced from 4.5pc to 2pc and tariffs on imported melting scrap have been reduced from 5pc to 2pc. Customs duty on imports of ships has been nullified from the earlier 2pc. Cash buyers in the country have thus, increased inquiries for new vessels. Vessels from Alang are also likely to find their way to Gadani.  

Pakistan large steelmaker association (PALSP) has requested the government to impose necessary safeguards as the reduction in taxes could flood their market with lower-priced billets from other countries. 



Imported ferrous scrap prices in Taiwan fell by $5/mt on Monday with the index for US HMS 1&2 (80:20) settling at $245/mt cfr Taiwan. Offers from the US were at $245-$250/mt cfr. US and Japanese scrap suppliers have started reducing their offers as Turkish buyers reduced their buying prices. Low demand for finished steel persists in the market. A few trades were heard on Monday at $245/mt cfr Taiwan. Prices in the global markets could fall by $5-$10/mt pressuring imported scrap prices in Taiwan. 

Offers for Australian-origin HMS 1&2 (80:20) were at $240/mt cfr. In small bulk markets, Japanese HMS 1&2 (50:50) was offered at $260/mt cfr Taiwan, down by $5/mt from Friday. In South Taiwan, Feng Hsin steel held its domestic scrap purchase prices unchanged from the prior week.




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