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

Domestic ferrous scrap prices in most Southeast and East Asian markets increased further this week fuelled by a rise in Japanese export prices and bullish global steel markets.



Most EAF steelmakers in the Kanto region raised their bids by JPY500/mt ($4.7/mt) from the prior week since suppliers refused trades at previous price levels. The Japanese currency appreciated against US$1 to JPY105.94 on Tuesday from JPY104.68 on July 30. The resulting lower realization due to conversion made suppliers raise export offers. This rise in export offers also gave domestic scrap prices a lift. 

Tokyo Steel increased domestic scrap purchase prices at Utsunomiya plant by JPY500/mt effective August 5, however, bids at its four other plants were kept unchanged. 

The mill’s purchase prices for #2 HMS after the revision will be JPY23,000/mt ($217/mt) delivered Utsunomiya mill. Bids for #2 HMS and busheling are at JPY23,500/mt and JPY25,000/mt delivered Kyushu, respectively. At Okayama mill, bids for #2 HMS and busheling are JPY23,000/mt and JPY24,000/mt delivered mill, respectively.


South Korea 

South Korean domestic scrap prices started rising this week following global cues. Mills raised their domestic scrap purchase prices by KRW5,000/mt ($4.18/mt) this week.

The Davis Index for domestic Heavy A settled unchanged at KRW285,000/mt ($238/mt) del Incheon, with deals heard at the index price. The index in Pohang settled at KRW280,000/mt delivered mill, up by KRW5,000/mt from the prior Tuesday. 

The weekly Davis Index for domestic Light A settled at KRW250,000/mt delivered Pohang mill, up by KRW5,000/mt. Trades for the grade were reported at the index price.  

Offers for Russian A3 scrap were at $265-270/mt cfr South Korea. Offers for Japanese #2 HMS were at JPY25,500/mt fob Tokyo bay, up by JPY500/mt from the prior week.



A rise in rebar and billet prices by TWD200/mt gave domestic ferrous scrap a lift in some parts of the country. 

The Davis Index for domestic HMS 1&2 (80:20) in South Taiwan, Tuesday, settled at TWD7,100/(241$/mt) del mill, up by TWD250/mt from a week ago. The index for HMS 1&2 (80:20) in North Taiwan settled at TWD7,300/mt delivered mill, up by TWD250/mt. Yards raised their expectations looking at a $10-15/mt increase in offers of imported ferrous scrap in the last two weeks.


Feng Hsin Steel’s purchase price for domestic HMS 1&2 (80:20) was at TWD7,100-7,200/mt delivered Taichung plant. The steelmaker’s base offers for rebar and billets increased further by TWD200/mt to TWD14,200/mt and TWD12,700/mt ex-works, respectively. Some mills offered TWD200/mt discounts on listed prices to boost trades.


 In seaborne markets, US-origin containerized HMS 1&2 (80:20) traded at $255/mt cfr Taiwan, up from $245-248/mt cfr Taiwan last week. The daily Davis Index for containerized US-origin HMS 1&2 (80:20) was unchanged at $253/mt cfr Taiwan from Monday. Buyers and sellers could not arrive at a consensus with a gap of $5/mt between bids and offers. Japanese small bulk cargoes of HMS 1&2 (50:50) were offered at $267-268/mt cfr Taiwan with no trades heard. Offers for shredded in small bulk cargoes were at $300-305/mt cfr Taiwan. 



The Davis Index for HMS 1&2 (80:20) settled at VND7,000,000/mt ($300.7/mt) delivered South Vietnam, inclusive of taxes, up by VND100,000/mt from the prior week. Due to increasing the rising pandemic cases in Vietnam, demand for finished steel has remained low for a couple of months now. Demand for HRCs in the export market, however, has been rising due to active purchases by Chinese buyers. Traders expect domestic scrap prices to be impacted once Formosa Ha Tinh blast furnace increases prices for finished steel for domestic deliveries this week.



In China, Shagang Steel reduced bids for domestic #2 HMS (6-10mm thickness) by CNY30/mt to CNY2,695/mt del Jiangsu mill, inclusive of 13pc VAT. The weekly Davis Index for the grade settled at the same price, down by CNY30/mt. Shagang Steel held rebar prices unchanged from the prior week for early August shipments. 

Prices for billets in the domestic market were at CNY3,370-3,380/mt ex-Tangshan mill on Tuesday.



The weekly Davis Index for domestic HMS 1&2 (80:20) inched up by THB650/mt to settle at THB8600/mt (276$/mt) delivered Rayong mill, inclusive of taxes. Domestic HMS 1&2 (80:20) was sold at THB8500-8700/mt delivered mill. US-origin containerized HMS 1&2 (80:20) scrap traded at $235-240/mt cfr Laem Chabang on Friday.



Prices for domestic HMS 1&2 (80:20) rose amid a rise in imported scrap and iron ore prices. The indexes for the grade settled at MYR1010/mt (239$/mt), up by MYR45/mt delivered western mills and at MYR1070/mt, up by MYR80/mt delivered eastern mills, inclusive of taxes from the prior week. Malaysian domestic ferrous scrap trades were limited with deals ranging from MYR1,000-1,100/mt. Amid a shortage of domestic scrap, its prices are expected to increase further this week.


($1= JPY105.97; TWD29.41; CNY6.9; THB31; MYR4.2 ; VND23,113; KRW1,194)


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