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

Imported ferrous scrap trades in Bangladesh have remained paused amid the ongoing lockdown to curb the spread of the second wave of COVID-19 infections. Transport restrictions along with the suspension of international flights for eight days hampered business activities as demand came to a standstill. Labourers have also left for their hometowns with the start of the holy month of Ramadan on April 14.


Suppliers continued to hold offers high as lower scrap collection rate in April is expected to impact June shipments. No major movement in containers is expected before the end of April. Few small-scale producers could shut factories to avoid losses as steel demand is expected to be under pressure till the Eid holidays, traders said. Monsoon season will begin soon after Eid, a time when construction activities take a backseat, so demand is expected to be tepid even then, traders noted.


The daily Davis Index for containerized shredded, Friday, settled at $482.5/mt cfr Chattogram, up $5/mt from Thursday. The index rose by $5/mt from the prior week. UK-origin containerized shredded offered at $485-490/mt cfr Chattogram but buyers remained away. Large mills have ample inventories in hand and also scheduled deliveries of ferrous scrap both in containers and bulks. 


Indian Sponge iron was offered at equivalent of $435-440/mt delivered to Narayanganj on barge, up $10-15/mt from the prior week. 


In the bulk market, US West Coast yards held offers high for Asian buyers amid improved demand from Bangladesh, Vietnam, South Korea and Malaysia. Despite a drop in Turkish bids due to depreciation in lira, offers to Asia remained flat to up. 


The daily index for HMS 1&2 (80:20) from Latin America settled at $459/mt cfr Chattogram, rebound by $4/mt on Friday. Latin American yards continued to sell in their domestic market or have shifted their focus to the Indian market as bids from Bangladesh were unattractive.


Amid rebound in offers, the daily indexes for US-origin, UK-origin, and Australia-origin containerized HMS 1&2 (80:20) settled to similar levels late last week each to $463/mt, $453/mt, and $465/mt cfr Chattogram, respectively. Against offers of HMS 1&2 (80:20) at $460-465/mt cfr Chattogram, bids have fallen to $450-455/mt cfr Chattogram.


Trades for premium scrap grades like P&S and Busheling were thin on limited offers. Tighten industrial generation due to shutdown of auto plants kept premium grades in short supply. The Davis indexes for P&S and #1 busheling, Friday, settled at $495/mt and $506/mt, up by $5/mt and $3/mt, respectively, from the prior week. 


Domestic scrap up

Increased demand for the domestic scrap and bullish global cues pushed the weekly index for ship scrap equivalent to P&S up by BDT1,000/mt to BDT46,500/mt ex-yards. Despite weak demand, prices recovered as scrapped ship offers surpassed the $500/mt mark amid slow deals. The index for domestic HMS 1&2 (80:20) rose by BDT1,000/mt to BDT45,500/mt ex-yard Chattogram.


On Friday, 16mm ship plate traded at BDT53,000-53,500/mt ex-yards while imported scrapped vessels prices remained at $500-510/ldt cfr Chattogram impacting purchases and slowing demolition rates.


Domestic steel dips

Domestic steel prices are expected to drop as the transportation challenges are impacting bookings. Construction demand has also cooled off on the suspension of few projects. 


Domestic billet offers continued to stay firm above BDT60,500-61,000/mt ex-works Chattogram despite limited trades. The weekly index for billet rose to BDT60,500/mt ex-works, rising BDT500/mt from the prior Friday. Southeast Asian billet offers remained rangebound amid a drop in Chinese prices. 


Large steelmakers including BSRM, AKS, GPH, and KSRM have held their asking rates for rebar considerably higher than the rest of the market. The index for large steelmakers’ rebar, Friday, was unchanged at BDT70,250/mt ex-works. Large mills cancelled discounts to maintain the spread between scrap purchases and rebar sales. 


The index for rebar from medium-scale mills in Dhaka was up by BDT250/mt to BDT66,500/mt ex-works. Small-scale mills sold rebar at BDT61,000/mt ex-works, pushing the weekly index up by BDT500/mt. Most end-users are opting for local rebar made through manually control and offered at almost BDT10,000/mt lower than automatic rebar. Financial challenges due to the pandemic have forced small producers to lower prices. 




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