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

US West Coast ferrous scrap dock prices increased in Portland and San Francisco but were unchanged in Los Angeles on Tuesday.


Contrary to buyer expectations, prices have firmed up over the last few weeks due to continued interest in imported scrap.


South Asian destinations continued purchasing scrap through the past week on expectations of continued demand recovery. Bangladeshi, Pakistani, and Indian mills are raising production plans as infrastructure projects resume. Given the regional trends in Asia, countries like Vietnam, South Korea, and Taiwan also remained active in the import scrap market. 


Japanese ferrous scrap export prices have firmed up after the higher Kanto bids earlier in the month resulting in Vietnamese billet suppliers turning to scrap from the US for lower-priced bulk. Japan’s domestic scrap prices remained unchanged at Tokyo Steel last week, which may limit further rises in Japanese scrap export prices. However, the expectation of higher domestic steel production in October could further support domestic and export scrap prices. 


As Japanese and US prices for export have increased, buyers are seeking cheaper, alternative bulk sources, especially in the local or regional markets. As a result, domestic scrap has inched up in many of the buying domestic markets such as Vietnam, Thailand, Taiwan, and South Korea. Asian buyers are also sourcing scrap from South America, Central America, and Russia.


The weekly Davis Indexes in Portland increased alongside domestic mill increases with HMS 1&2 (80:20) rising by $25/gt to $234/gt delivered dockside. P&S 5ft and shredder climbed by $21/gt to $244/gt delivered and $183/gt delivered, respectively. 


As expected last week, scrap prices in Portland increased after mills in the Pacific Northwest raised domestic buying prices by $20-25/gt against August settled prices. The rise in September scrap buying prices is in line with the expectations that prices in the Midwest and South will move up by $30-40/gt, depending on grade, with a few even expecting increases of $50/gt on some deals compared to August settled prices.


In San Francisco, the weekly indexes increased for HMS 1&2 (80:20) and P&S 5ft by $7/gt to $232/gt delivered and $236/gt delivered, respectively, and shredder feed rose by $9/gt to $160/gt delivered.


The weekly Davis Indexes in Los Angeles remained unchanged for HMS 1&2 (80:20) at $186/gt and P&S 5ft at $203/gt delivered. The shredder feed index also held at $146/gt delivered. Sources report that some sellers began to receive the price increases last week. Container activity was quiet during the mid-week after several weeks of uptrends in buying activity and prices. 


The containerized market in Los Angeles increased by $5/mt this week as HMS 1&2 (80:20) prices moved from $245-250/mt fas to $250-255/mt fas early this week, but sellers report that export buyers have turned quiet in the past two days.

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