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

Weekly domestic ferrous scrap prices in Asia declined amid negative sentiment on rising COVID-19 cases and a fall in global ferrous scrap prices. 



Taiwan’s domestic ferrous scrap prices inched down from the prior week.Demand for domestic finished steel is expected to remain stable despite a few projects being impacted by supply chain disruption amid COVID-19 spread. 


The weekly Davis Index for domestic HMS 1&2 (80:20) in south Taiwan settled at NT$6,450/mt ($214/mt) del plant, down by NT$50/mt. The weekly index for HMS 1&2 (80:20) in north Taiwan settled at NT$6,650/mt del plant, down by NT$100/mt.


In South Taiwan, Feng Hsin Steel’s domestic scrap purchase prices remained unchanged this week. The mill is paying NT$6,500-6,600/mt for domestic HMS 1&2 (80:20) delivered Taichung plant.


The steelmaker held its grade 40 rebar offers flat including local taxes at NT$14,800/mt ex-plant. End users, however, bid at NT$14,200-14,300/mt as some mills in Taiwan were offering an additional discount of NT$200/mt on their rebar prices to boost trades.


US-origin containerized HMS 1&2 (80:20) traded in the range $215-220/mt cfr Taiwan on Tuesday, down by $5/mt from the prior late week.



Japanese domestic ferrous scrap prices have remained unchanged since March 12. A rise in COVID-19 cases across the globe has dented demand. Auto makers have shut production activities in Japan. Toyota too would suspend production for 10 days at five of its works effective April 3 to 13.  


Prices for #2 HMS are at JPY19,500/mt ($177/mt) del to Utsunomiya plant in the Kanto region and JPY18,000/mt del Kyushu plant, flat since March 12. 


South Korea

Domestic ferrous scrap prices were on downtrend despite a fall in the number of new COVID-19 cases in the country. The weekly Davis Index for domestic Heavy A settled at KRW262,500/mt ($212/mt) del Incheon, down by KRW2,500/mt. The Davis Index for Heavy A settled at KRW252,500/mt del Pohang, also down by KRW2,500/mt from the prior Tuesday. 


The weekly Davis Index for domestic Light A settled at KRW235,000/mt delivered Pohang plant, down by KRW7,500/mt from the prior week. A few trades were reported at the index prices.


On March 19, Hyundai Steel lowered its domestic scrap purchase prices by KRW10,000/mt from the last set of prices. The mill lowering its bids by JPY1,000/mt fob for Japanese scrap from the prior week. Bids for #2 HMS are at JPY21,000/mt fob Japan, HMS 1&2 (50:50) at JPY21,500/mt. Bids for other high-grade scrap such as P&S, shredded and busheling are at JPY23,500/mt.



The weekly Davis Index for HMS 1&2 (80:20) delivered South Vietnam settled at VND5,550,000/mt ($239/mt) inclusive of taxes, down by VND250,000/mt.


Vietnamese steel mills continued to purchase ferrous scrap from Japan. HS scrap equivalent to P&S traded in the range $262-265/mt fob Japan. 


Southeast Asian billet prices were under pressure driven by a plunge in global ferrous scrap prices and lowered Russian billet export offers due to Rubel depreciation. Billet prices were in the range $395-400/mt cfr Southeast Asia, down by $10/mt from the prior week.



The weekly Davis Index for domestic HMS 1&2 (80:20) settled at CNY2,500/mt ($354/mt) inclusive of 13pc vat delivered to mill in eastern China, down by CNY15/mt. Late last week, Shagang Steel lowered its domestic scrap procurement prices on March 22 & 23. Prices dropped by a total CNY60/mt ($8.6/mt) for all deliveries. Bids were lowered amid excess supply of ferrous scrap and thinned profit margins.Purchase prices were dropped despite a rise in finished steel prices. Shagang is paying CNY2,640/mt for HMS 2 and CNY2,690/mt for HMS #1 to domestic suppliers, including delivery and the 13pc VAT.



Thailand’s domestic scrap prices fell by $20-25/mt on global cues and subdued domestic steel demand. The weekly Davis Index for domestic HMS 1&2 (80:20) delivered Rayong settled at THB8,100/mt ($247/mt), down by THB600/mt ($18/mt) inclusive of taxes.



The weekly Davis Index for domestic HMS 1&2 (80:20) delivered western mills settled at MYR845/mt ($191/mt), down by MYR15/mt and the index for HMS 1&2 (80:20) delivered eastern mills was at MYR960/mt inclusive of taxes, down MYR10/mt from the prior week.

The Malaysian government has suspended mining activities to control the spread of COVID-19. A drop in iron ore supply could create demand for ferrous scrap in the near term if finished steel demand picks up in the country.


($1= TWD30.2, CNY7.06, THB32.81, MYR4.43 VND23,245.5, KRW1,240.7)  

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