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

Imported scrap trades in Bangladesh surged on Monday, driven by a sharp rise in container freight rates. On Friday, the weekly index for container freight from the New York route to Bangladesh rose by $14.28/mt to $63.8/mt. 


Mills with low inventories resumed trades actively despite high prices. With rising bids from Bangladeshi mills for imported scrap and shipbreaking scrapped vessels, many suppliers have turned their back to Bangladesh. Yards paid highest in the subcontinent to fetch a few scrapped ships of large tonnages as the country started its COVID-19 vaccination drive.  


Late last week, 8,000mt of HMS 1&2 (80:20) traded at $490/mt cfr Chattogram from a Singaporean supplier.  


The daily Davis Index for containerized shredded, Monday, settled at $508.13/mt cfr Chattogram, up by $11.34/mt from Friday. There were very limited trades for shredded as most buyers preferred to book lower-priced HMS scrap. Offers on Monday were at $510-515/mt cfr Chattogram while a few from Australia and New Zealand were at around $505/mt cfr Chattogram. However, availability remains a concern with yards running short of material.  


Australian HMS 1&2 (90:10) in containers traded at $475/mt cfr Chattogram. Against offers UK-origin at $485-490/mt cfr Chattogram, mills remained interested in HMS 1&2 80:20 at $470-475/mt cfr Chattogram.  

The Davis Index for containerized HMS 1&2 (80:20) of the US-origin and Latin America-origin settled at $484.29/mt and $482/mt cfr Chattogram, rising by $6.29/mt and $8/mt, respectively, from prior Friday. Offers for HMS #1 from Chile were at around $490-495/mt cfr Chattogram on Monday.  


In the bulk market, resumption of trades with China kept Japanese suppliers interested but resurgence of COVID-19 in the both countries in addition to European nations kept trades suspended. With the announcement of export duties, Russian mills plan to consume domestic scrap and sell more billets in the export markets. Indications for HMS 1&2 (80:20) in bulk were at $510-515/mt cfr Chattogram with sentiments mixed, waiting for Turkey’s next move.    


Domestic steel rally takes a pause  

Domestic steel prices in Bangladesh on Monday remained largely flat from Friday. Mills were interested in increasing the asking rates further, but the building contractors’ association asked the government to intervene and stop the rally in steel prices. This led to slower domestic steel sales in the market. Ship scrap equivalent to P&S traded at BDT43,000-43,500/mt ex-works. Domestic HMS 1&2 (80:20) was offered at BDT42,000-42,500/mt ex-yards Chattogram and shipbreaking plates at BDT48,500/mt ex-yards on Monday.  


For shipbreakers, yards booked ships in the range of $460-480/ldt. A leading recycler claimed that the uptrend might continue till $500 but yards would stay away from booking at those levels. Yards witnessed strong demand for ship scrap, however, very limited scrapped vessels are being offered from Europe amid fresh COVID-19 lockdowns. Domestic billet traded at BDT52,500-53,000/mt ex-works Chattogram as mills attempted to raise offers.


On Monday, large steelmakers offered rebar at BDT67,000-68,000/mt ex-works. Large mills are targeting rebar at around BDT70,000/mt ex-works to maintain the spreads between scrap and rebar. Medium-scale mills in Dhaka held their offers for rebar at BDT62,000-63,000/mt ex-works. 


($1= BDT84.68)

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