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

Steel and ferrous scrap markets in Bangladesh remained silent because of the two-week strict nationwide lockdown till August 5 amid COVID-19 resurgence. Only a few buyers were inquiring about imported ferrous scrap. Sellers were largely away from fresh offers unable to find spaces on vessels. Most shipping lines are eyeing a further hike in freight rates in August, keeping traders away.


The daily Davis Index for containerized shredded, Tuesday, settled flat at $552/mt cfr Chattogram. Large mills could either opt for bulk ferrous scrap cargoes or continue to book scrapped vessels, as they find these alternatives cost-effective over containerized ferrous scrap imports.


The daily index for US-origin containerized HMS 1&2 (80:20) was flat at $529.5/mt cfr Chattogram. The indexes for Latin America-origin, UK-origin, and Australia-origin HMS 1&2 (80:20) settled at $515/mt, $517/mt, and $526/mt cfr Chattogram, respectively, also unchanged.


In the bulk market, offers were few, but mills were interested for HMS 1&2 (80:20) at $525-530/mt cfr Chattogram levels. Some mills placed inquiries for Japanese H2 bulk at competitive price, with importers in Vietnam and Taiwan largely away.


Most of the offices, industries and factories are either closed or operating with a very limited workforce. Transportation of public and goods have been impacted amid movement restrictions. 


Laborers who had gone for Eid-al-Adha celebrations are yet to return to workplaces. The diversion of oxygen for medical use has also impacted daily production rates. Meanwhile, heavy rains affected steel and imported raw material trading in Bangladesh. Unable to maintain profits, many mills have either lowered production or completely idled plants. Weak finished steel sales have also impacted the decision.


According to the customs department, the average scrap import price in June 2021 was at $461/mt cfr, higher by 63pc than the same month in the prior year. Over the H1 2021, monthly average import prices rose by $130/mt for imported scrap. Meanwhile, steel prices did not show an equal increase. Mills are thus eyeing a hike in steel prices despite weak demand.


On Tuesday, offers for rebar from the large-scale mills like BSRM, AKS, GPH, and KSRM were unchanged in the range of BDT71,000-72,000/mt ex -works. Medium-scale mills offered rebar at BDT67,000-68,000/mt ex-works, at marginally higher prices from the pre-Eid period.

Except for a few governments construction projects, steel-consuming activities remain hit and could take at least mid-August to regularise.



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