Mills in Bangladesh continued ferrous scrap bookings mostly for May shipments even as the national lockdown continues. Many mills have cut production. Mills whose production presently is unhampered, could stop melting activity altogether if the COVID-19 outbreak worsens in the coming weeks. The present social distancing measures are effective till April 11.
A major steel mill in Chattogram booked 32,000mt bulk ferrous scrap cargo with shredded at $250/mt cfr Chattogram and HMS 1&2 (80:20) at $245/mt cfr Chattogram, down by $5/mt from the last weeks’ offers. Demand for imported material has fallen significantly due to quarantine measures announced at Chattogram port and increased costs due to a lack of transportation and labour.
In containers market, the Davis Index for containerized shredded scrap settled at $243/mt cfr Chattogram on Friday, down by $17/mt from the prior week. Early this week, thin trades for containerized shredded were at $245-250/mt cfr Chattogram which then dropped to $240/mt cfr Chattogram. Overall trades were very few. Traders were looking for Japanese bulk scrap cargoes, prices for which fell significantly pressured by a decline in global markets.
The Davis Index for containerized P&S settled at $250/mt cfr Chattogram on Friday, down by $18/mt from the prior week. The Davis Index for US-origin containerized HMS 1&2 (80:20) declined to $235/mt cfr Chattogram, from $248/mt in the prior week.
The Davis Index for Australian HMS 1&2 (80:20) settled at $235/mt cfr Chattogram, down by $20/mt from the prior week. A trade by a major mill was reported at the index price.
The Davis Index for Latin American HMS 1&2 (80:20) settled at $235/mt cfr Chattogram, down by $13/mt from the prior week. Brazilian traders lowered their offers to $235-240/mt attempting to liquidate their stocks amid weakened demand in Americas and Europe.
Domestic steel prices stagnant on weak demand
Inquiries from Bangladesh were comparatively better than those from India and Pakistan. But if finished steel sales fails to pick up, mills could halt productions and disappear from scrap markets.
Leading steel mills like BSRM, Abul Khair and GPH continue to operate for now. Medium and small-scale furnaces, however, have lowered their output. Rebar manufactures kept their sales offices closed on transportion issues. GPH Ispat has postponed its testing and commencement of new quantum EAF.
The Davis Index for domestic ship-breaking HMS 1&2 (80:20) settled at BDT28,250/mt inclusive of local taxes ex-yard Chattogram on Friday, down by BDT250/mt ($3/mt) from the prior week. The Davis Index for domestic ship-breaking P&S settled at BDT28,750/mt ex-yard, down by BDT250/mt ($3/mt) from the prior week. Prices dropped as the demand has been subdued and stocks at yards remained high.
Finished steel demand is close to nil as mega infrastructure projects have been stalled. Additionally, during the Ramadan month (April 23- May 23, 2020) buying activities could lower as labours go on holidays. The Davis Index for large steelmakers rebar settled at BDT58,750/mt ex-producer, unchanged from the prior week.