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

US West Coast ferrous scrap dock prices decreased over the past week amid a decline in export prices on recent deals and slower inquiries from Asian buyers. 


The weekly Davis Indexes in Portland declined for HMS 1&2 (80:20) by $15/gt to $178/gt delivered dockside and decreased for P&S 5ft and shredder feed by $14/gt to $187/gt delivered and $155/gt delivered, respectively.


Domestic mills in the US Northwest are expected to trade soft-sideways in the upcoming July buying week. The sentiment supported flat dock prices last week as they were still weaker than competing mill prices. 


Dock prices were expected to remain flat through the end of next week, too. However, to the surprise of several sellers, they declined early this week on export weakness and sufficient scrap inventories. Several docks are reported at capacity with pending vessel arrivals. 


In Los Angeles, the weekly Davis Indexes decreased across all grades as both HMS 1&2 (80:20) and P&S 5ft declined by $11/gt to $136/gt delivered dockside and $156/gt delivered, respectively, and shredder feed fell by $10/gt to $96/gt delivered.


Taiwanese buyers are expected to resume inquiries by Wednesday as mills return from short-term outages or holidays. Lower summer production schedules, reduced Japanese export offers, and billet prices alongside a trend of lower domestic ferrous scrap prices in key Asian markets have US West Coast sellers wondering by how much their next bulk and container deals could reduce.


Deals are expected to decline by $5-15/mt from previous ones depending on destination. Some Asian countries such as Pakistan and Bangladesh are negatively affected by logistics and liquidity. On the other hand, in South Korea and Taiwan, domestic scrap is being favored and higher domestic finished steel prices are struggling. 


Some sellers considered the possibility of containerized HMS 1&2 (80:20) reaching $195-200/mt fas, down $15-20/mt from the $215-220/mt fas last week. In the bulk markets, negotiations that were expected to close for South Korea and Taiwan mills slowed down in the face of lower price expectations in the next two weeks.


The weekly indices in San Francisco decreased more compared to the other two regions as HMS 1&2 (80:20) slipped by $23/gt to $179/gt delivered dockside alongside P&S 5ft that declined $17/gt to $190/gt delivered. The index for shredder feed also decreased by $13/gt to $131/gt delivered.


In San Francisco, the dock price reductions began at the end of last week with notices of price declines continuing on Monday and Tuesday this week.

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