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Weekly Ferrous Update: Aug 23-27

Ferrous Market Update 08/27/2021

 

Turkey

  • The daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) decreased by $2.74/mt on Friday following a sale from Europe.
  • An Iskenderun-based mill purchased HMS 1&2 (80:20) at $442/mt cfr from a large European supplier, though full details of the transaction were not available at the time of publication.
  • A deal was also closed in the Azov-Black Sea basin around two days ago when a Turkish mill bought HMS 1&2 (80:20) from Romania at $417/mt cfr. Still, the availability of short-sea cargoes to Turkey remains limited.
  • Demand for ferrous scrap was low this week as most Turkish mills have finished their purchases for September shipment. Bookings for October shipment are expected to begin next week after the Victory Day holiday on Monday.
  • Spot rebar prices in the Turkish domestic market were flat on Friday. ($1=TRY8.40)

 

Turkey domestic

  • The weekly Davis Index for DKP scrap (equivalent to auto bundles) in Turkey declined TRY4/mt on Friday after one mill dropped its purchase price.
  • Kroman settled new purchase price for DKP grade at TRY3,750/mt delivered, decreasing it by TRY50/mt over the week, while the other steelmakers kept their purchase prices at previous levels.
  • Demand for domestic scrap, as well as for imported material, remains muted in Turkey amid slow steel product sales. ($1=TRY8.40)

 

CIS

  • The weekly Davis Indexes for HMS 1&2 (80:20) or A3 scrap in Russia’s Baltic Sea and Black Sea regions were unchanged on Friday due to the lack of sales to Turkey.
  • Ferrous scrap exporters in St Petersburg estimate HMS 1&2 (80:20) prices at $445-450/mt cfr Turkey, though negotiations remained slow in the last week of August with no deals reported. A supplier from Murmansk, Arkhangelsk was offering HMS 1&2 (95:5) at around $475/mt cfr.
  • Sales from Rostov-on-Don to Turkey were also missing as buyers targeted below $440/mt cfr for A3 material, while most exporters considered such prices unacceptable and switched to sales in their domestic market.
  • In the meantime, there was some demand for scrap in Asia which resulted in a new transaction from the Far East of Russia to South Korea at $480/mt cfr for A3 material.
  • Collection prices diverged in Russia depending on the region. The weekly Davis Index for A3 scrap decreased by RUB400/mt in St Petersburg dock on Friday and increased by RUB400/mt in Rostov-on-Don dock. ($1=RUB74.06)

 

Europe

  • The weekly Davis Index for HMS 1&2 (75:25) in the ARAG region decreased by €8/mt on Tuesday after prices fell in the most recent sales to Turkey.
  • Ferrous scrap exporters from the Netherlands (Amsterdam, Rotterdam) and Belgium (Antwerp, Ghent) continued to reduce collection prices after Turkish importers achieved deals at lower prices. A supplier from Belgium sold 25,000mt of HMS 1&2 (80:20), 7,500mt of shredded scrap, and 7,500mt of bonus material at an average price of $451/mt cfr Karadeniz last week.
  • This week, negotiations between European scrap sellers and Turkish buyers remain slow and most exporters see no other options but to drop collection prices despite the anemic inflow of the material as further sales prospects are vague. (€1=$1.18)

 

UK dockside

  • Davis Index’s weekly north and south UK HMS 1&2 (80:20) ferrous scrap indices declined by £5/mt ($7/mt) delivered dockside, respectively, on Tuesday.
  • UK dockside ferrous scrap purchase prices were slashed further over the past week, as bulk exporters responded to relatively slack demand and weaker export prices, particularly to Turkey.
  • The reduction in dockside rates has been executed to protect narrower margins and also stem the flow of material across the weighbridge until such time that demand picks up.
  • The weekly indices for north and south UK OA (Plate & Girder) fell by £5/mt delivered dockside, respectively while north and south UK 5A/5C (frag feed) ferrous scrap indices also dropped by £5/mt on the same basis. (£1=$1.37)
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Spain 

  • Davis Index’s northern Spain HMS 1&2 (80:20) and shredded small bulk weekly ferrous scrap indices declined by €8/mt ($9/mt) on Friday.
  • Buyers lowered their bids in a subdued market while suppliers resolutely held offers close to last transacted levels. A Spain-based buyer commented that the market had turned relatively quiet given that suppliers were awaiting cues from prices on major seaborne trade routes.
  • Meanwhile, the UK and North European ferrous scrap suppliers have also reduced dockside purchase prices in response to weak export benchmarks and a sharp increase in freight rates. 
  • Davis Index’s UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded indices fell by €10-15/mt fob during the week. (€1=$1.18)

 

Germany domestic

  • Davis Index’s monthly German ferrous scrap indices declined by €8-32/mt ($9-38/mt), depending on grade and location, following the conclusion of August’s monthly mill-yard negotiations.
  • German monthly mill-yard settlements for ferrous scrap declined over the past month due to relatively slower export demand and lower prices in deepsea trade routes, particularly to Turkey. That said, prices for new production ferrous scrap grades held up relatively well as a result of constricted generation rates, declining only by €8-10/mt in most regions, compared with the sharp declines of €15-32/mt witnessed in obsolete grades.
  • North and South German ferrous scrap indices declined by €8-18/mt delivered mill for Sorte 1 (E1), Sorte 2 (E2), Sorte 3 (E3), Sorte 4 (E40), Sorte 5 (E5), and Sorte 8 (E8).
  • East German ferrous scrap indices dropped by €20-23/mt for E1, E2, E3, E40, E5, and E8 delivered mill and declined by €8-32/mt for these grades in West Germany on the same basis. (€1=$1.17)
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US dockside

  • US East Coast collection prices for ferrous scrap saw steeper declines this week as the market continued to trend down for the fifth successive week amid abundant supply. Houston dock prices decreased as well with sharper downward movements after remaining flat last week.
  • Scrap material is in ample supply while export activity has gradually tempered since mid-June. Export markets have been quiet while demand and prices for steel products are slipping.
  • The Davis Index for US HMS 1&2 (80:20) exports to Turkey was down by about $5/mt cfr on Tuesday compared to Aug 17. The expanded monthly view indicates prices for this export grade have fallen by $29.53/mt compared to its Jul 27 price.
  • Dockside sales for #1 HMS on the East Coast have slipped by approximately $10/gt this week and currently range between $330-350/gt depending on dock location and prior sales level. The grade has dropped by about $30/gt compared to $360-380/gt a month ago.
  • In Boston, prices were marginally softer than levels at alternative East Coast docks. The weekly Davis Index for export yard #1 HMS and P&S 5ft both moved down $9/gt delivered Boston dock. The shredder feed index ticked down by $1/gt delivered Boston export yard.
  • The weekly Davis Index for export yard buying prices in New York dropped by $11/gt for #1 HMS delivered and declined by the same amount for P&S 5ft delivered. Shredder feed is maintaining some strength, moving up by $2/gt delivered New York dock.
  • In Philadelphia, the Davis Index for export yard collection prices fell by $11/gt for #1 HMS delivered and P&S 5ft dropped by $12/gt delivered Philadelphia dock. The index for shredder feed remained stronger, inching up by $1/gt delivered.
  • In Houston, the weekly Davis Index dropped by $20/gt for #1 HMS and P&S 5ft delivered. The index for shredder feed decreased by $19/gt delivered Houston dock.
  • US West Coast dockside ferrous scrap prices continued rangebound for the third successive week. The docks at San Francisco and Portland did not decrease prices but Los Angeles announced a reduction of $10/gt on cut grades, shredded, and shredder feed. 
  • The UK and EU dock prices declined on weaker export prices and lower demand from Turkey this week, while the limited Japanese Kanto scrap auction, which declined by only $11/mt, recently gave strength to the Asian ferrous import market expectations. Tokyo Steel has raised some finished steel prices while maintaining its ferrous scrap purchase prices. Japan is the first source for Asian buyers for bulk ferrous, hence, the strong pricing gives US exporters the possibility to compete. 
  • The weekly Davis Indexes in Portland remained unchanged with #1 HMS, P&S 5ft and shredder feed flat at the export yard. Regional market participants note that docks have kept prices rangebound to attract inventories given the strong US domestic market despite the softer outlook for the September trading week. 
  • Many scrap dealers believe that Asian markets will increase their buying interest as fall begins and mills face fewer energy curtailments in domestic markets and construction projects resume in less heat. 
  • The San Francisco weekly Davis Indexes remained unchanged with #1 HMS, P&S 5ft and shredder feed flat. 
  • In Los Angeles, the Davis Indexes for #1 HMS and P&S 5ft both fell by $5/gt delivered. Shredder feed declined by $8/gt delivered. Still, sellers inform that those with volumes did not reduce their prices. In some cases, depending on the volume and quality, #1 HMS could have garnered up to $375/mt delivered to port in the past week.  
  • Some market participants note that COVID-19 related lockdowns seem to be prolonging the bubble that will inevitably require more inventories imported from the US West Coast, especially as domestic supplies tighten on limited physical mobility by peddlers. Countries and companies are also developing processes and systems to better manage production and projects around lock-down policies. 
  • The Davis Index for US-origin HMS 1&2 (80:20) fell by $4.97/mt cfr Turkey on Tuesday from Aug 17. East Coast docks have continued their downward trend, except for shredder feed, which in some cases has gained in the past few weeks, on the lower Turkish deals and import prices. On the West Coast, though, the anticipation of recovering Asian markets in a tight global scrap environment may buoy markets.

 

US domestic

September ferrous scrap trading is anticipated to commence in the US following the Labor Day Holiday, on Sep 6, with downward price pressure expected across all grades and regions, as supply abounds. 

  • Some regions could see more aggressive to-be-determined (TBD) negotiations next week given the still high ferrous demand from mills trending at high capacity utilization. Market participants gauge that the best scenario may bring unchanged prices compared to August though many foresee either soft sideways levels or potentially, a further decay as exports, pig iron, and iron ore prices have slipped.
  • Opinions on downside levels against August settled prices range from decreases of $10-40/gt on prime grades like #1 busheling and down $10-50/gt on secondary grades such as #1 HMS. Further declines are being promoted by some large buyers claiming higher regional scrap inventories, while the majority of sellers do not see deeper decreases as realistic. Any price decay on prime will indicate its first drop in over a year when primes fell $10-30/gt in August 2020.
  • The sell-side sentiment is not overly pessimistic because the bearish outlook is deemed temporary as steel prices maintain strength and mills report that order books remain full amid thriving sales. Steel capacity utilization rates are holding steady at 85pc, as lead times extend as well. Market participants noted the possibility of gains against the preceding month’s settled prices in October and November.
  • Waning price projections at present are mostly linked with mill maintenance outages by US Steel, for example, that are limiting scrap needs and may lead to possible order cancellations. Cleveland-Cliffs is also set to idle its large blast furnace No. 7 for maintenance beginning Sep 1 to conduct planned revamping work.
  • Scrap yards witnessed strong intake flows even with the $20/gt downside last month and an additional $20/gt decline heard over the past few weeks in some regions. Scrap supply and flows have outpaced mill demand causing abundant material to accrue with limited options for placement of the accumulating scrap in the short term. 
  • According to a mill source, despite higher finished steel sales, scrap input pricing can fall in September on sheer supply and demand dynamics given the temporary oversupply. Yet, some scrap yards in Texas and Alabama have noted that their intake and processed inventories are running low.
  • Auto shutdowns continue to curb prime grade generation. However, mills seem to have met their current #1 busheling needs. Primes mostly held flat last month; though, mill buyers tested taking the price down while August trading progressed. In fact, the Ohio valley region saw several #1 busheling consumers sit out during August trading. Their plans for September buying were still unclear on Friday.
  • Basic pig iron imports have upheld exceptional price strength since the end of 2020 hitting a high point of $694/mt cfr Nola in May 2021. The prime alternative gradually decreased thereafter, with the sharpest declines occurring since July, and falling to $545/mt cfr Nola on Aug 27 on oversupply and lack of demand for additional prime in the US. Moreover, iron ore spot prices have declined to near $150/mt cfr China for Fe 62pc at present from $183/mt cfr on Aug 3.
  • HRC pricing seemed to have hit a lull on Friday but reached as high as $2,116/mt ($1,920/nt) this week with most transactions more in the range of $2,050-$2,094/mt ($1,860-1,900/nt) depending on volumes, up $22-44/mt compared to $2,006-$2,072/mt ($1,820-1,880/nt) on Aug 3.
  • Turkish imports of US-origin HMS 1&2 (80:20) declined by $31.62/mt cfr on Friday compared to Jul 27 on persisting weak demand and activity. Export markets have been gradually slackening since mid- to late-June when US export HMS 1&2 (80:20) started to fall below the $500/mt point on Jun 22. Export buyers from other regions such as India, Bangladesh, and Vietnam reduced imported ferrous demands on COVID-19 lockdowns, uncertainty given the resulting economic slowness, and seasonality. 

 

US containers

US containerized ferrous scrap prices varied in New York with some gains on better grades while they continued mostly rangebound on the West Coast. HMS 1&2 (80:20) indexes made some gains on the West Coast due to limited sellers for the grade.   

  • The New York weekly Davis Index reversed course on some grades with gains compared to a contraction last week. The #1 busheling index climbed by $5/mt, P&S 5ft rose by $8/mt and shredded increased by $5/mt. HMS 1&2 (80:20) declined slightly by $3/mt but machine shop turnings fell by $16/mt as some Indian buyers reported obtaining deals on the grade given the recent market uncertainty. 
  • Indian buyers actively purchased ferrous containers of HMS 1&2 (80:20), P&S 5ft, and shredded over the week on resumed trades. Some traders reported softer US-origin offers for shredded surfacing for Pakistan today. 
  • The weekly Los Angeles Davis Indexes encountered mixed movements but remained relatively rangebound with #1 busheling falling by $3/mt and shredded decreasing by $2/mt. P&S 5ft trended unchanged again while HMS 1&2 (80:20) rose by $5/mt with heard deals moving towards $400/mt fas. Market participants reported few active sellers due to high container prices, continued low container availability, and port issues. Additionally, most exporters are focusing on fulfilment of previously made sales with some scrap yards preferring to focus on domestic opportunities or placing scrap in deep-sea docks.  
  • Southeast Asia, including Thailand and Indonesia, has been mostly out of the market due to COVID-19 shutdowns. Taiwan and Vietnam have encountered increases of $5/mt cfr on their imported HMS 1&2 (80:20) pricing.  
  • Japanese domestic ferrous scrap is gradually recovering and has the potential of raising domestic prices at Tokyo Steel, which may result in improvements in Japanese export offers. Japan may face tight domestic supply given the ongoing COVID-19 lockdown due to end in two weeks. A stronger Japanese ferrous export market will support US prices and sourcing. 
  • The San Francisco Davis Indexes for #1 busheling and shredded remained unchanged while HMS 1&2 (80:20) gained $6/mt and P&S 5ft climbed by $1/mt.  
  • In Seattle, the Davis Index for #1 busheling dropped by $2/mt as shredded fell by $1/mt. HMS 1&2 (80:20) climbed by $5/mt while P&S 5ft remained unchanged week-on-week. 
  • The US-origin HMS 1&2 (80:20) index fell by $4.38/mt cfr Turkey on Thursday from Aug 19. US domestic September ferrous trade is likely to begin next week with mostly a consensus of soft movements given the slight oversupply of scrap to mills on seasonality. Depending on the region, some anticipate a decline by $10-20/gt across all grades while others are forecasting a contraction on #1 busheling and secondary by up to $30-40/gt against August settled prices.  

 

Mexico

  • Ferrous scrap prices continued to trend down for the second successive week, declining by an average of MXN267/mt ($13.22/mt) amid softening steel prices in the region.
  • The weekly Davis Index for primary scrap like #1 busheling declined by MXN686/mt delivered in Northern Mexico where demand for the grade was the weakest. The index for #1 HMS fell by MXN619/mt, while P&S 5ft decreased by MXN264/mt delivered. Shredded went down by MXN128/mt delivered, and machine shop turnings remained unchanged delivered by Friday.
  • The weekly Davis Index in Central Mexico for #1 HMS went down by MXN250/mt delivered Mexico consumer on Friday, while P&S 5ft fell by MXN250/mt delivered. Shredded decreased by MXN250/mt delivered, while machine shop turnings fell by MXN200/mt delivered and busheling decreased by MXN200/mt delivered by Friday.
  • The weekly Davis Index in Bajio Mexico for #1 HMS decreased by MXN174/mt delivered Mexico consumer on Friday, while P&S 5ft fell by MXN465/mt delivered. Shredded went down by MXN152/mt to delivered, while machine shop turnings fell by MXN134/mt delivered and busheling decreased by MXN239/mt to delivered by Friday. ($1 = MXN20.19)
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Japan

Japanese EAF steelmaker Tokyo steel has cut its ferrous scrap purchase prices by JPY500/mt ($4.54/mt) for deliveries to Tahara, Kyushu, Okayama, Utsunomiya and Takamatsu works, effective Aug 28, as the market softened. Only bids for #1 busheling at Okayama works are kept unchanged.

  • After the revision, bids for #2 HMS are at JPY48,000/mt ($435.96/mt) delivered Tahara, JPY49,500/mt ($449.58/mt) delivered Okayama, JPY48,000/mt ($435.96/mt) delivered Kyushu, JPY48,000/mt delivered Utsunomiya and JPY47,500/mt delivered Takamatsu. 
  • For September deliveries, the steelmaker raised listed retail prices by JPY3,000/mt for a few flat products, keeping prices for rebar and other construction steel products unchanged from the prior month. 
  • Demand for HMS #2 could remain subdued in Japan. Scrap collection has also slowed amid COVID-19 restrictions.  
  • The weekly Davis Index for #2 HMS, Wednesday, rose by JPY1,000/mt ($9.10/mt), fob and fas Japan.
  • The weekly Davis Index for Japanese P&S 5ft (small bulk) settled flat cfr China port on Wednesday. 
  • The weekly index for the #1 busheling (shindachi) settled flat fob and fas Japan.
  • The weekly Davis Index for shredded and HS settled flat fas Japan.  
  • HMS 1&2 (50:50)’s index settled flat cfr Haiphong. 
  • The index for Japanese HMS 1&2 (50:50) settled flat cfr Taiwan.  
  • Offers for Japanese high grades stayed firm. 
  • The Japanese government, Wednesday, decided to place eight additional districts under its COVID-19 state of emergency as the country struggles with case overload. ($1 = JPY110.10)

 

South Korea

The weekly Davis Indexes for domestic Heavy A rose by KRW15,000/mt($12.86/mt) del Incheon and rose by KRW12500/mt($10.72/mt) del Pohang. The weekly Davis Index for domestic Light A on Tuesday del Pohang, went up by KRW15,000/mt. 

  • Demand has decreased as some steelmakers have halted production for EAF maintenance.
  • Mills were only interested in high-grade scrap from overseas sellers and focused on domestic HMS and low-grade scrap on easier availability and competitive prices. 
  • The weekly Davis Index for containerized HMS 1&2 (80:20), Wednesday, rose by $8/mt cfr South Korea.
  • The weekly Davis Index for P&S 5ft is flat while the index for shredded increased by $8/mt cfr South Korea.
  • The weekly Davis Index for #1 HMS rose by $9/mt cfr South Korea. 
  • Korean local scrap continues to be competitively priced to import.  
  • Dongkuk steel purchased Russian A3 at $480/mt cfr South Korea.
  • Hyundai steel slashed Japanese scrap prices by JPY1,000/mt ($9.08/mt) for all grades except for H1:H2 on Friday, Aug 20. Revised bids for #2 HMS were at JPY44,000/mt, Shredded at JPY54,000/mt, P&S 5ft (HS) at JPY57,000/mt and #1 busheling at JPY62,500/mt fob Japan. ($1 = KRW1,168.99) 

 

Taiwan

The weekly Davis Indexes for domestic HMS 1&2 (80:20) is flat del Northern mill, and Southern mill.

  • Feng Hsin Steel kept its scrap purchase bids and rebar prices flat for the week to gauge the market direction. 
  • The weekly Davis index for HMS 1&2 (50:50) is flat cfr Taiwan.
  • Scrap prices recovered due to an increase in overseas offers though local steel sales did not witness a major improvement. 
  • The weekly Davis Index for containerized #1 HMS and #1 busheling rose by $5/mt each cfr Taiwan. 
  • The index for shredded rose by $5/mt while the index for P&S 5ft rose by $2/mt cfr Taiwan. 
  • The weekly index for HMS 1&2 (80:20) settled flat cfr Taiwan port. ($1 = TWD27.93)

 

China

The weekly Davis Index for HMS 1&2 (80:20) remained flat delivered China consumer on Tuesday. Strict production cuts have lowered the demand for ferrous scrap in China.

  • Shagang steel lowered scrap bids by CNY50/mt ($7.70/mt) on Aug 19. This was the steelmakers’ third price cut in August. While the steelmaker cut long steel prices by CNY150/mt ($23/mt) for late-August deliveries.
  • The daily domestic billet price in China rose by CNY20/mt to CNY4,950/mt (764.05/mt) ex-Tangshan inclusive of VAT. 
  • Offers for imported billet recovered in China following trades in the Philippines at $675-680/mt cfr. A tight supply of coking coal and weak export keep Chinese steel demand slow.  
  • International iron ore futures recovered on Friday. For Fe 62pc daily spot price recovered by over $16/mt from a week and by $3.5/mt to above $153/dmt cfr North China. Finished steel futures however mixed on Friday following low inventory data combine with production cuts. ($1=CNY6.48)

 

Vietnam

The weekly Davis Index for HMS 1&2 (80:20) in Vietnam inched up by VND18,235/mt ($0.80/mt) delivered Southern mill due to rising freight rates. 

  • Demand for finished steel remained subdued. 
  • Vietnam has imposed strict house arrest orders in the southern megacity of Ho Chi Minh City and deployed an army to implement quarantined measures as COVID-19 cases continue to surge. The lockdown is further extended to Sep 15. 
  • The weekly Davis index for containerized #1 HMS, Thursday, rose by $5/mt, cfr Vietnam. The weekly index for shredded rose by $5/mt while the index for P&S 5ft rose by $2/mt cfr Vietnam, respectively.
  • The weekly index for #1 bushelling rose by $5/mt cfr Vietnam port. 
  • The weekly Davis index of HMS 1&2 (80:20) went up by $5/mt cfr Vietnam from the prior week. ($1 = VND22,784.23)

 

Indonesia

Indonesia remained under a lockdown to curb the spread of COVID-19 and prices dropped in a silent market. Domestic scrap prices are still competitive to imported scrap.  

  • The weekly Davis index for P&S 5ft dropped by $7/mt cfr Indonesia port. 
  • The weekly Davis Index for shredded dropped by $5/mt while the index for #1 busheling dropped by $8/mt cfr Indonesia. ($1 = IDR14,400.15) 

 

Thailand

The weekly Davis index for domestic HMS 1&2 (80:20) settled down by TWD142/mt ($4.32/mt) del Rayong mill. 

  • Steel mills continued to stay silent amid COVID-19 restrictions. Domestic supply is tight with buyers’ eyeing imported HMS 1&2 (80:20) at $415/mt cfr Thailand. ($1 = THB32.66)

 

Malaysia

The weekly Davis Index for HMS 1&2 (80:20) dropped by MYR5/mt each del eastern mill and del western mill. 

  • Malaysia’s king Ismail Sabri Yaakob took charge as the prime minister of the country on Friday which could resolve the political turmoil in the country to some extent. On the other hand, surging COVID-19 cases and an extension of lockdown led to an absence of trades in the country. ($1 = MYR4.19)

 

India 

  • Mills in India booked limited quantities of imported ferrous scrap on mixed global sentiments and volatile Chinese futures. As the monsoon recedes, increasing production rates could lead to easing supply and a slight downward adjustment in steel and ferrous scrap prices.  
  • The daily Davis Index for containerized shredded, Friday, dipped by $1.25/mt cfr Nhava Sheva. The index was down by $6.25/mt from last Friday. Interest for shredded remained scarce even from regular alloy makers. However, amid low inventories with mills and the COVID-19 situation appearing to be a bit under control, traders keep offers elevated hoping demand revival.
  • The daily Davis Index for UAE-origin containerized HMS 1&2 (80:20) was unchanged cfr Nhava Sheva. The index was down by $3/mt from prior Friday. 
  • The daily Davis Index for US-origin containerized HMS 1&2 (80:20) dropped by $2.5/mt cfr Nhava Sheva on Friday. Market participants await clarity on domestic monthly settlements for September in the US markets.  
  • The Davis indexes for containerized P&S and #1 busheling cfr Nhava Sheva, down $3/mt from last Friday. Inquiries for prime grades remained scarce as mills found it unattractive.  
  • Domestic melting scrap prices in Alang dropped as yards liquidated piled up inventories. Melting scrap traded ex-Alang, down Rs300/mt from Thursday but lower Rs100/mt from prior Friday. In Mumbai, the asking prices for rebar dropped by Rs300/mt on Friday, while the same was lower by Rs1,200/mt than prior Friday. 
  • From India, billet export offers were at $600-605/mt fob basis. However, no major sales were reported this week amid volatile freight rates. 
  • In Mandi Gobindgarh, ingots traded Friday, marginally down by Rs300/mt from Thursday while Rs1,600/mt from prior Friday. Softening domestic fundamentals cooled off inquiries. ($1=Rs74.25)

 

India domestic

Domestic HMS prices trended down this week as mills delayed restocking of raw material inventories.

  • Scrap suppliers reduced their offers to attract bids. The daily Davis Index for HMS 1&2 (80:20), Friday, declined by Rs500/mt ($6.79/mt) del Mumbai mills and the same index declined by Rs1,400/mt del Mandi Gobindgarh compared to the previous Friday.
  •  

Pakistan  

  • Imported ferrous scrap trades reported in a wide range of disparity of $15-20/mt in Pakistan. 
  • Leading yards in supplier countries are holding material awaiting a rebound in prices. 
  • The Pakistani rupee hit an eleven-month low of PKR166.47 against the US dollar on Friday. Last Friday, it was at PKR164.34. 
  • The daily Davis Index for containerized shredded on Friday dropped by $5/mt cfr Qasim and declined by $19/mt from last Friday. After a long gap, offers in India, where demand is stable, are higher than in Pakistan. 
  • The daily Davis Index for UAE-origin HMS 1&2 (80:20) cfr Qasim, down $3/mt. The index dropped by $5/mt from Aug 20. Trades for UAE-origin mixed #1 HMS and P&S reported firm at $505/mt cfr Port Qasim. 
  • The daily index for US-origin HMS 1&2 (80:20) cfr Port Qasim on Friday, was lower by $6.25/mt from Aug 20. Demand for long transit material remained low in South Asia despite easing supply. 
  • The Davis Index for P&S 5ft dropped by $15/mt from the previous Friday while the index for #1 busheling dropped by $17/mt.
  • Lower volumes of rebar sales led to a slight decline in asking prices. The weekly Davis Indexes for rebar ex-works Karachi and Punjab, dropped PKR1,000/mt on Friday. 
  • The weekly index for domestic Bala billet inched up by PKR250/mt to PKR140,500/mt ($843/mt) ex-works on Friday. 
  • The weekly index for Art Q toke scrap (equivalent to a mix of HMS and P&S) increased by PKR1,000/mt ex-yards while Pure Q toke scrap (equivalent to shredded) rose by PKR750/mt ex-yard Lahore, respectively, amid tight supply.
  • Demolition activities in the Gadani turned slow as recyclers pulled back. This led to a decline in scrapped vessel offers by upto $20-25/ldt. ($1=PKR166.49)

 

Bangladesh

  • Mills continued to ramp up steel productions but steel sales in the retail markets were not very encouraging, weighing down bids for imported ferrous scrap. 
  • Amid very low buying inquiries for shredded, the daily Davis Index for containerized shredded, Friday, inched down by $2.5/mt cfr Chattogram. The index dropped by $12.5/mt from Aug 20. 
  • Containerized freight rates stayed elevated at above $90.3/mt on New York to Chattogram port route.  
  • Except for a few mills, which are running out of scrap inventories, most buyers were silent and focused on liquidating their finished steel inventories on a priority basis. 
  • The daily index for US-origin containerized HMS 1&2 (80:20) cfr Chattogram, was down $3.5/mt from Thursday. The index dropped by $11/mt from prior Friday. The increasing availability of HMS in most supplier countries has weighed prices down.  
  • The indexes for UK-origin and Australia-origin HMS 1&2 (80:20), respectively, were down by $8/mt and $13/mt from Aug 20. 
  • The Davis Index for HMS 1&2 (80:20) from Latin America dropped by $5/mt, as compared to last Friday. Traders were struggling with a shortage of empty containers for exports.  
  • From prior Friday, the Davis Index for P&S 5ft dropped by $9/mt, while the index for #1 busheling cfr Chattogram, down $7/mt. 
  • The weekly indexes for ship scrap equivalent to P&S and domestic HMS 1&2 (80:20) were down BDT500/mt. For ship plates, offers dropped by BDT2,500/mt ex-yards from prior Friday. 
  • The weekly index for rebar from large-scale mills declined by BDT250/mt ex-works. The weekly Davis Index for rebar by medium-scale producers was down by BDT500/mt, and for small-scale mills, the index settled ex-works, down by BDT1,500/mt.  
  • The weekly index for billet fell BDT500/mt ex-works. Overall steel demand is likely to lag expectations and the recovery could take a bit longer than expected. ($1=BDT85.2)

 

Metallics

 

US/CIS

The weekly Davis Index for basic pig iron (BPI) fell by $25/mt cfr New Orleans port Friday on lower sale prices to alternative destinations while the CIS BPI index fell by $24/mt fob Black Sea as supply exceeded demand.

  • Buyers remain inactive though sufficient offers from the CIS and Brazil persist in the global market. Exporters don’t have an option except to provide significant discounts to spur sales. As a result, a Russian producer sold BPI to China at $545/mt cfr last week. Bid levels in China are heard as low as $520/mt cfr, but most sellers are not willing to drop that low yet.
  • A new booking was heard in the US from Brazil at no higher than $545/mt cfr this week, but exact details of the transactions were not available at the time of publication.
  • Demand is currently lacking in the US especially for prime grades, but BPI purchases may revive near or after September trading where prime grade prices are slated to fall.
  • The Davis Index for nodular pig iron (NPI) imports decreased by $20/mt cfr Nola as offers remain firm on limited supply. US hot briquetted iron (HBI) imports fell by $15/mt cfr Nola on low activity. Both grades are also softening in line with other materials.
  • Italian imported pig iron market remained quiet amid summer vacations in the country. As a result, the weekly Davis Index for CIS BPI in Italy dropped by $20/mt cfr on Friday on strong bearish sentiment.
  • BPI offers from the CIS to Turkey were reported at $540/mt cfr, but they attracted minimal interest from buyers. Still, a supplier from Russia sold 3,000mt of semi-nodular pig iron at $550/mt fob to Turkey.

 

India

In a week, the index for sponge iron prices declined by Rs500/mt del Mumbai mills and the index declined by Rs1,400/mt del Mandi Gobindgarh. A decline in input cost and low domestic demand from steelmakers pressured sponge iron offers. ($1=Rs73.6)

 

India semi-finished and finished steel

  • The daily Davis Index for billet in Mumbai was flat compared to the previous Friday. 
  • In Raipur, the daily index for billet fell by Rs1,000/mt ($14/mt) ex-works from the previous Friday amid weak buying from re-rolling mills.
  • In Mandi Gobindgarh, the daily index for ingots declined by Rs1,500/mt ($20/mt) from the previous Friday in line with the fall in local scrap prices.
  • South-based Steelmaker Rashtriya Ispat Nigam Limited (RINL) hiked rebar prices by Rs500/mt ($7/mt) for 16-36mm, effective Aug 27. ($1=Rs74.67)

 

Shipbreaking weekly

Shipbreaking scrap prices declined this week as demand remained low from the local rolling mills. The daily Davis Index for HMS attachments and Melting, Friday, declined by Rs300/mt ($4.07/mt) ex-Alang each as compared to the previous Friday.

  • Re-rolling scrap prices also followed a similar trend and the index for 4Ani declined by Rs700/mt ex-Alang and the index for 14Ani declined by Rs800/mt ex-Alang.
  • Demand from ship plates also remained tepid and the index for 2kg plates declined by Rs300/mt and the index for 5kg plate declined by Rs500/mt ex-Alang.

 

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