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Ferrous market update: December 14-18

Ferrous Market Update 12/18/2020

 

Turkey

  • The daily Davis Index for Turkish imports of US-origin HMS 1&2 (80:20) increased by $13.31/mt cfr on Friday as speculation of potential bulk exports to China continue to stoke bullish sentiment.
  • The lowest offers heard in the market from any region were at $460-465/mt cfr, up to $10-15/mt from a day earlier.
  • Prices have increased by at least $10/mt every day this past week which has left mills struggling to secure firm offers. Suppliers are hesitant to offer in a market that rises every day.

 

Turkey domestic

  • The weekly Turkish Davis Index for DKP scrap (equivalent to auto bundles) increased by TRY131/mt ($16.7/mt) delivered on Monday amid a continued uptrend in its domestic scrap market, supported by increasing import scrap prices. ($1 = TRY7.84)

 

CIS

  • The weekly Davis Index for A3 scrap soared by $50/mt fob Baltic Sea and by $46/mt fob Black Sea on Monday amid a price rally in the Russian export market.
  • The workable price level for A3 material from St Petersburg and Rostov-on-Don moved to $415-425/mt cfr Turkey after a reported sale of HMS 1&2 (80:20) from Sweden to Turkey at $419/mt cfr. However, most Russian scrap exporters have currently put offers on hold, expecting prices to rise by another $10-20/mt.
  • Last week, several deals for A3 scrap from Rostov-on-Don were fixed at $395-400/mt cfr Turkey.
  • Collection prices in Russia rose further by RUB1,500/mt ($20/mt) delivered St Petersburg dock, but remained unchanged delivered Rostov-on-Don dock. ($1 = RUB73.30)

 

Europe

  • The weekly Davis Index for HMS 1&2 (75:25) in the Amsterdam, Rotterdam, Antwerp, and Ghent (ARAG) region surged by €35/mt ($43/mt) delivered dockside on Dec 15.
  • North European dockside purchase prices have largely been driven by parabolic increases in Turkish ferrous scrap import prices over the past week.
  • Dutch and Belgian-based ferrous scrap processors noted that scrap purchase prices had spiralled “out of control”, with benchmarks increasing almost every 12 hours. A German ferrous scrap trader supported this with an anecdote that material, which seemed “expensive” in the morning quickly became a better deal by the afternoon.
  • Davis Index confirmed the sale of cargo by an Austria-based scrap trader to a Turkish mill at $421/mt for HMS 1&2 (80:20) and $431/mt for shredded, February shipment.
  • The weekly Davis Indexes for HMS 1 and Bonus scrap in ARAG also rose by €35/mt delivered dockside, respectively, on Tuesday. (€1 = $1.22)

 

UK dockside

  • Davis Index’s weekly north and south UK HMS 1&2(80:20) ferrous scrap indices increased by £10/mt ($13/mt) delivered dockside on Dec 15.
  • UK bulk ferrous scrap exporters reportedly displayed “exceptional discipline” while negotiating dockside purchase prices. A UK-based trader commented that major processors had kept list-prices almost constant compared with last week while passing on large price hikes to select suppliers.
  • By comparison, Davis Index’s Turkish HMS 1&2 (80:20) US-origin ferrous scrap import index jumped almost $51/mt cfr Turkey over the past seven days, on Dec 14.
  • British shortsea bulk coasters and transhippers continue to benefit from a healthy arbitrage between the UK and northern European destinations, particularly Amsterdam, Ghent, Antwerp, and Rotterdam.
  • The weekly indexes for north and south UK OA (P&S) increased by £7/mt over the week delivered dockside on Dec 15. Davis’ north and south UK 5A/5C (frag feed) ferrous scrap indexes climbed by £5/mt delivered dockside over the past week. (£1 = $1.34)

 

Spain

  • Davis Index’s weekly northern Spain HMS 1&2 (80:20) and shredded small bulk ferrous scrap indices surged by €31/mt cfr ($38/mt) and €28/mt cfr, respectively, on Friday.
  • This week, shortsea bulk ferrous scrap tags were driven higher by stronger EU dockside purchase prices and robust demand from competing shortsea and deepsea markets.
  • While the last HMS 1&2 (80:20) cargoes sold to northern Spain were at €310-315/mt, cfr earlier in the week, EU dockside purchase prices smashed through these over the past two days.
  • Some UK and north European ferrous scrap suppliers have lifted their offers of HMS 1&2 (80:20) to “unrealistic” levels of €360/mt, according to a Spanish buyer.
  • Ravenous ferrous scrap demand has now seen Turkish mills bring purchases forward for March shipment as they buy 60-90 days ahead compared with their traditional 30-day window.
  • Davis Index’s UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded also climbed by €24/mt fob and €22/mt fob, respectively, on Dec 18. (€1 = $1.23)

 

Germany domestic

  • Davis Index’s monthly German ferrous consumer scrap indices increased by €32/mt ($39/mt) on average, depending on grade and location, following the conclusion of mill-yard negotiations in December.
  • Domestic ferrous scrap tags surged as local steel producers tried to prevent material from being diverted towards export markets, where suppliers have enjoyed parabolic price hikes.
  • A Germany-based scrap trader commented that relatively stable-to-firm local consumption married with robust demand from north European export terminals had created a significantly tight supply availability in the market.
  • Stocks are also low at present, but another mill buyer noted that ferrous scrap supply and demand fundamentals do not warrant the significant price hikes of the past month.
  • North German ferrous scrap indices climbed by €34-38/mt over the past month. East German ferrous scrap indices increased by €23-35/mt, South German ferrous scrap indices leaped €40/mt higher, and West German indices surged by €30-35/mt over the past month.
  • Market participants have indicated, mills will be willing to pay €65-75/mt more for January ferrous scrap deliveries. (€1 = $1.23)

 

US dockside

  • US East Coast and Houston ferrous scrap dock collection prices remain high amid strong export activity, rising domestic scrap prices, and limited supply.
  • Dockside prices have gradually risen since early November with the most expansive gains in the past two weeks. Export yard buying prices for #1 HMS on the East Coast ranged between $285-300/gt on Tuesday, up by around $15-20/gt from last week and by about $35/gt since Dec 1.
  • Exports prices for HMS 1&2 (80:20) from the US have risen by around $50/mt cfr Turkey in a week and over $130/mt cfr since late October.
  • In Boston, the weekly Davis Index for export yard #1 HMS climbed $17/gt while P&S 5ft jumped $19/gt, delivered Boston dock. Shredder feed rose by $6/gt delivered.
  • The weekly Davis Index for export yard buying prices in New York rose by $15/gt delivered for #1 HMS and $16/gt delivered dock for P&S 5ft. The index for shredder feed climbed $2/gt delivered.
  • In Philadelphia, the Davis Index for export yard collection prices rose by $17/gt delivered for #1 HMS, by $19/gt delivered for P&S 5ft, and were unchanged for shredder feed.
  • In Houston, the weekly Davis Index climbed by $25/gt for #1 HMS and $33/gt for P&S 5ft delivered Houston dock. The shredder feed index increased by $13/gt delivered.
  • On the US West Coast, ferrous scrap dock prices jumped in Los Angeles, remained unchanged in San Francisco, and climbed moderately in Portland.
  • Limited availability of containers also prompted sellers to expect additional interest via bulk vessels.
  • The region’s scrap demand has risen due to the increase in domestic mill demand in the Southwest and Texas as well as export demand from Asian and Mexican mills. Tight scrap inventories and flows continue throughout the West Coast as industrial sources are still reporting scrap production at 50-60pc, compared to the same year-ago period.
  • Some scrap sellers believe that prices could warrant further hikes on high iron ore prices.
  • The Los Angeles docks made three price increases in November with some deals still above list prices. The latest increase on Dec 15, averaging near $50/gt, is substantial for a market that has been trending below the other regions.
  • Pricing at the docks is dynamic and currently a sellers’ market with deals attracting more payment.
  • US domestic scrap prices are expected to increase by $50-60/gt on deals that rose by $70-85/gt during early December trading. Docks are competing with domestic mills for scrap inventories.
  • Higher Turkish deals continue supporting the strong global scrap market with export prices in the EU, US, Japan, Russia, and Latin America elevating.
  • Domestic scrap prices in India and Turkey continue moving up, supported by import scrap prices and in turn, limited domestic scrap inventories are seeding higher import scrap prices. Pakistan and Bangladesh are encountering higher import prices, but buyer interest is weakening on uncertainty and risk.
  • The weekly Davis Indexes in Portland increased as docks provided additional incentive to draw larger scrap volumes. The index for #1 HMS increased by $6/gt and P&S 5ft climbed by $7/gt. The index for shredder feed rose by $2/gt delivered. The San Francisco Davis Indexes remained unchanged.
  • The weekly Davis Indexes in Los Angeles increased substantially as #1 HMS jumped by $52/gt, P&S 5ft climbed by $51/gt, and shredder feed rose by $21/gt.
  • Los Angeles dock prices have historically lagged Portland and San Francisco. Local buyers with destinations via rail to domestic mills have been aggressively outbidding the docks, while Mexican mills have also been booking containers in the region.

 

US containers

  • US containerized scrap prices increased significantly this week after the indexes for various core grades surged by $34-51/mt on the East Coast and by $54-70/mt on the West Coast.
  • The market may receive support into January with forecasts of $50-80/gt increases against December settled prices. Variances will depend on the region, grade, and where prices settled given higher offers from mills that have moved into January pricing at the end of the early December trading period.
  • India, which is facing a stronger billet export market, raised domestic scrap prices, and higher sponge iron prices, could continue purchasing imported scrap despite the rising prices in that market.
  • Pakistan mills are assessing the domestic market at present and have reduced import buys, though they could resume in January. Bangladeshi buyers have also slowed down buys due to higher prices but remain active because of their imported scrap needs.
  • Global scrap prices may continue receiving strong support with higher domestic scrap prices and tight global scrap inventories in Turkey, Taiwan, South Korea, Vietnam, and Japan.
  • Japanese exporters may continue with firm pricing, supporting US scrap export prices to Asia.
  • Limited scrap offers are being heard out of the US, which considering strong demand, will also support scrap prices into January at the minimum.
  • The weekly Davis Indexes in New York climbed by $34/mt fas for #1 busheling, by $51/mt fas for HMS 1&2 (80:20), by $39/mt fas for P&S 5ft, and by $37/mt fas for shredded. Machine shop turnings caught up with other grades this week after leaping by $82/mt fas as several Indian buyers sought the grade.
  • The Davis Indexes in Los Angeles jumped for #1 busheling by $58/mt fas, for HMS 1&2 (80:20) by $64/mt fas, for shredded by $57/mt fas and for P&S 5ft by $69/mt fas.
  • The container market has boomed since October with HMS 1&2 (80:20) in Los Angeles climbing by $19/mt fas between early October and November. By Dec 3, this index increased by $32/mt fas and has leaped by $74/mt fas over the past two weeks, surpassing the $51/mt aggregate increase in the previous two months.
  • Concerns over container availability and freight prices continue. The challenges in the containers market are greater for some buyers than those related to higher prices in the scrap import market. Freight tags could double in January and some instances, freight quotes for 40ft containers have risen by 165pc for January compared to December prices.
  • Scrap inventories are tight on the West Coast because of lower feedstock and some sellers withdrawing from the active market with plans to return to higher prices in early January.
  • Some scrap dealers are also focusing on accumulating inventory for early January trading. Due to the continued increase in container prices this week, the spread between container and dock is still wide making containers more attractive to sellers.
  • In San Francisco, the index for #1busheling leaped by $70/mt fas, for HMS 1&2 (80:20) by $64/mt fas, and both P&S 5ft and shredded by $68/mt fas. Buyers in search of better grades have been substituting P&S 5ft and shredded depending on inventories.
  • The Davis Indexes in Seattle for #1 busheling jumped by $68/mt fas and HMS 1&2 (80:20) rose by $65/mt fas. P&S 5ft and shredded both increased by $66/mt fas.

 

Mexico

  • Mexico’s domestic ferrous scrap prices climbed by $8.7-32.5/mt depending on the region on Friday amid strong demand and tight supply.
  • Scrap prices in the northern region increased in the range of $25-32.5 as mills continued to struggle with material collections despite their willingness to pay higher rates to secure volumes for December 2020 and January 2021
  • Market participants expect scrap prices to rise by $30/mt in January if the supply tightness continues.
  • The lack of material availability after one of Deacero’s scrap yards caught fire on Dec 16 in Guadalupe, Nuevo León could raise scrap prices further as the steelmaker may have to redistribute its existing and new scrap among other recyclers.
  • In North Mexico, the weekly Davis Indexes increased by MXN500/mt delivered Mexico consumer for machine shop turnings and shredded. The index increased for HMS 1&2 (80:20), P&S 5ft, and shredded by MXN650/mt, MXN900/mt, and MXN100/mt delivered, respectively.
  • Scrap prices in Central and Bajío regions rose to a lesser extent by $8.7- 17.5/mt across all grades as demand outpaced supply.
  • The weekly Davis Indexes in Bajío for HMS 1&2 (80:20) rose by MXN350/mt delivered Mexico consumer. P&S 5ft, shredded, #1 busheling, and machine shop turnings also increased by MXN375/mt, MXN163/mt, MXN300/mt, and MXN600/mt delivered, respectively.
  • In Central Mexico, the weekly Davis Indexes for all grades increased by MXN175/mt delivered Mexico consumers. ($1=MXN19.96)

 

Japan  

  • Tokyo Steel announced an eighth price hike in December. After the revision, Tahara’s purchase prices remained unchanged while those at three other mills increased by JPY1,000/mt ($14/mt). The mill increased bids by JPY1,500/mt for deliveries to Takamatsu.
  • The weekly Davis Index for #2 HMS rose by JPY3,955/mt ($38/mt) fas amid a rise in offers. In the export market, the index for the same grade rose by JPY4,042/mt fob Japan.
  • In the Kanto region, the Davis Index for #1 HMS increased by JPY3,792/mt. The index for the same grade rose by JPY4,125/mt fob Japan.
  • The weekly index for busheling rose by JPY3,045/mt fas and was up by 10.7pc or JPY4,214/mt fob Japan. The indexes for HS and shredded grade rose by JPY4,167/mt fas and JPY4,542/mt fas, respectively.
  • Yards offered Japanese HMS 1&2 (50:50) on Wednesday at prices up by $50/mt from the prior week. In Vietnam, the index for Japanese HMS 1&2 (50:50) increased by $30/mt cfr. ($1=JPY103)

 

South Korea  

  • South Korean domestic ferrous scrap prices trended flat this week. Mills could raise domestic bids amid rising imported scrap offers.
  • The Davis Index for domestic Heavy A was flat delivered Incheon and Pohang, respectively, on Tuesday.
  • A few mills preferred lower-priced Light A scrap. The weekly Davis Index for domestic Light A settled flat delivered Pohang mill. Suppliers held onto material expecting a price hike amid rising global prices.
  • Steel mills in Korea are cautiously buying containerized scrap and not keen on negotiating for bulk scrap due to rising offers.
  • The weekly Davis Index for containerized HMS 1&2 (80:20), Wednesday, was up by $46/mt cfr, with no deals heard. Offers still rose to $395-405/mt cfr, up by $60-70/mt from the week prior.
  • The weekly Davis Indexes for P&S 5ft, #1 HMS, and shredded rose by $45/mt, $48/mt, and $41/mt cfr South Korea, respectively.
  • Two bulk deals for 60,000mt and 32,000mt for #2 HMS were heard late last week, after which offers increased further making imports unviable.
  • Unable to gauge the price direction, some South Korean mills were undecided on bid levels. ($1=KRW1,094.7)

 

Taiwan  

  • The Davis Index for containerized US-origin HMS 1&2 (80:20), Friday, rose by $13/mt cfr from Thursday and by $40/mt from Dec 11. Taiwanese buyers stated that current offers for containerized scrap are unviable.
  • The weekly Davis Indexes for containerized P&S 5ft, #1 HMS, shredded, and #1 busheling rose by $50/mt, $37/mt, $59/mt, and $54/mt cfr, respectively. Most buyers stayed away due to rising offers.
  • Despite limited demand, rising offers are pushing ferrous scrap prices up in Taiwan. Traders indicated that container shortage and delays in shipments have made importers slow down purchases. Taiwanese steelmakers raised rebar prices this week on high input costs.
  • Mills preferred local scrap due to rising imported prices. South Taiwan’s Feng Hsin raised rebar and scrap prices by TWD700/mt and TWD600/mt ($21/mt), respectively.
  • China Steel Corporation (CSC) raised finished steel prices for Q1 2021 by TWD1,200-1,500/mt ($43-53/mt) from the prior set of prices amid high raw material prices and an uptrend in global steel prices. On average, CSC hiked prices by 6.1pc. Steelmaker cited positive business sentiment due to the successful launch of the COVID-19 vaccine and strengthening economic activities as the rationale for the price hike. ($1=TWD28)

 

China

  • In China, Shagang Steel lowered finished steel and ferrous scrap prices by CNY50/mt on Tuesday amid lowering domestic demand in winter. The steelmaker is focusing on exporting billets and rebars. Iron ore prices fell by $5.5/mt from the prior week after hitting a seven-year high of $154.5/mt cfr China. Scrap prices might fall further in December due to cold weather and limited demand.
  • The weekly Davis Index for the HMS 1&2 (80:20) rose by CNY50/mt ($7.6/mt) delivered mill on Tuesday.
  • Prices for Q235 150mm square billets in Tangshan fell by CNY50/mt ex-works including 13pc VAT. Southeast Asian billet exporters offered material at prices up by $10/mt from last week.
  • Baosteel raised HRC, CRC prices for domestic January shipment by CNY400/mt and CNY500/mt, respectively, to transfer the rise in input costs to consumers. ($1=CNY6.5)

 

Vietnam 

  • Increasing Japanese and US ferrous scrap offers forced steel mills to hold back on new scrap bookings.
  • In the containers market, the weekly index for US-origin HMS 1&2 (80:20) increased by $43/mt cfr. Amid limited supply from the US and Japan, offers are likely to rise further next week. Container shortage and vessel space unavailability also impacted trades.
  • The weekly index for P&S 5ft and shredded rose by $49/mt and $40/mt cfr, respectively, on Thursday.
  • Prices for #1 busheling in containers rose by $45/mt cfr from a week ago.
  • The weekly Davis Index for HMS 1&2 (80:20) rose by VND17,3750/mt ($7.5/mt) delivered South Vietnam inclusive of taxes. The Vietnamese steel market is gradually recovering, but mills have increased domestic scrap purchases, staying away from imports. ($1=VND23,170)

 

Indonesia

  • Indonesian mills were quiet this week amid rising US-origin offers, delay in shipments, and the approaching exporter registration deadline of Jan 1. No deals were heard this week and the situation could remain the same until there is clarity on the new procedure.
  • The difference between offers and bids stayed around $20-30/mt cfr. The weekly Davis Index for HMS 1&2 (80:20) rose by $42/mt cfr Jakarta.
  • The indexes for P&S 5ft and #1 HMS rose by $48/mt and $43/mt cfr Jakarta, respectively. No deals were heard this week. The weekly Davis Index for #1 busheling rose by $44/mt cfr, while shredded rose by $45/mt cfr.

 

Thailand

  • The weekly Davis Index for domestic HMS 1&2 (80:20) fell by THB50/mt ($1.6/mt) delivered Rayong mill including taxes.
  • The imported scrap market was bullish, and a few buyers restocked scrap readily available at the port or domestic yards. Traders said scrap demand will remain firm and imported prices could rise further and lift domestic scrap prices. Higher freight charges and a shortage of containers have forced mills to procure domestic scrap. ($1=THB30)

 

Malaysia 

  • The weekly indexes for HMS 1&2 (80:20) rose by MYR75/mt and MYR1,235/mt delivered western mills and eastern mills including taxes, respectively. With increasing COVID19 cases, production and demand remain impacted in Malaysia. Mills thus preferred domestic scrap over high-priced imported scrap.
  • Finished steel demand is expected to rise after the pandemic subsides. ($1=MYR4)

 

India 

  • Imported ferrous scrap offers in India continued to trend up amid strengthening domestic steel prices. Traders were optimistic about a recovery in imported scrap as domestic demand continues to outpace supply. Steel mills, however, are resisting the price levels and hope to lower their import limit.
  • Secondary steelmakers in Gujarat, Punjab, and Jalna operated at lower capacities to cut their scrap requirements. Demand from Mumbai-based alloy and rebar makers is gradually rising as their inventories have started depleting.
  • The Davis Index for containerized shredded on Friday increased by $1.75/mt cfr Nhava Sheva from Thursday and by $21.87/mt from a week ago.
  • Asking prices for HMS scrap from Dubai and Kuwait rose as traders anticipate demand to strengthen further once suppliers in the US, Europe, Latin America, and Australia step away from the market for the new year holidays. The Davis Index for UAE-origin HMS 1&2 (80:20) rose by $23/mt cfr Nhava Sheva from a week ago. Domestic demand for rebar is strong in Dubai, and most traders chose to cater to the domestic scrap consumption. Offers for containerized Australian HMS 1&2 (80:20) cfr India, rose by $15-20/mt from Dec 11.
  • The index for #1 busheling, P&S, and Turning cfr Nhava Sheva, was up by $27/mt, $26/mt, and $23/mt cfr, respectively, from the prior week driven by high offers. Bids for premium grades were limited with few trades of Turning in Mumbai.
  • A strengthening billet export market could support scrap imports in India. Following the rising futures market in China, prices could rise further in the short term. Outlook for 2021 remained bullish, offering support to all markets.

 

India domestic

  • Domestic ferrous scrap prices in India remained firm. Imported scrap prices have reached levels unviable for secondary mills, who are thus vying for trades in the domestic market.
  • In Mumbai, the Davis Index for HMS 1&2 (80:20) rose by Rs300/mt from Thursday and by Rs1,300/mt delivered mill from a week ago. In Mandi Gobindgarh, the index rose by Rs200/mt in a day and by Rs1,400/mt delivered mill in a week.
  • Finished steel demand has started to recover, with infrastructure projects picking pace. However, most end-users are operating at lowered margins and are thus looking to reduce the input cost. A trader informed Davis Index that the market may enter a corrective phase in a few weeks. Some mills fear the likelihood of dumping of Chinese HRC in the market, which could pressure steel prices.($1=Rs73.55)

 

Pakistan  

  • Pakistani mills were apprehensive about restocking as domestic steel prices, especially commercial billet, have failed to rise. Following global cues, some sellers hope for trades to pick up before the year-end.
  • The daily Davis Index for containerized shredded, Friday, rose by $1.49/mt cfr Port Qasim. The index rose by $24.42/mt from a week ago. Most suppliers are either holding back offers or keeping them firm citing a sellers’ market ahead of holidays.
  • The Davis Index for UAE-origin HMS 1&2 (80:20) cfr Port Qasim, rose by $1/mt from Thursday. UAE suppliers are holding on to their material amid expectations of higher prices. Rebar prices in the UAE firmed up prompting higher domestic scrap demand.
  • A harsh winter in many rural regions has halted construction, while large infra projects catered by leading steelmakers are facing cash flow issues.
  • The index for US-origin HMS 1&2 (80:20), Friday, cfr Port Qasim, gained by $23.36/mt from a week earlier following high offers from supplier yards. The weekly Davis Indexes for P&S 5ft and #1 busheling increased by $35/mt and $38/mt, respectively.
  • In the domestic market, limited trades pulled Bala billet prices down ex-works Punjab, with index down by PKR1,893/mt from Dec 11. The Davis Index for G-60 billet settled ex-works Punjab, down PKR500/mt from Dec 11.
  • The weekly Davis Index for G-60 rebar settled flat ex-works Karachi but rose by PKR107/mt ex-works Punjab from the prior week. A major mill in the South has failed to encourage buying and started offering discounts this week.
  • The index for Art Q toke scrap equivalent to a mix of HMS and P&S jumped by PKR1,036/mt ex-yard Lahore, Friday, from late last week. The weekly index for Pure Q Toke (shredded) rose PKR229/mt ex-yards in line with rising imported scrap prices. Domestic ferrous scrap prices in Pakistan rose gradually this week. ($1=PKR160.14)

 

Bangladesh

  • Only a few trades for imported ferrous scrap were reported in Bangladesh. A persisting shortage of containers and rising freight costs have raised offers. Many small-scale mills could stop purchases and halt production amid a cash crunch. ‘Victory Day’ holiday on Wednesday also led to slow trading.
  • The Davis Index for containerized shredded, Friday, rose by $20.29/mt cfr Chattogram from last week and by $1.25/mt from Thursday.
  • The daily index for Latin America-origin HMS 1&2 (80:20) cfr Chattogram climbed by $1/mt from Thursday and gained $21/mt from Dec 11. Offers for Latin American mix HMS #1 and P&S rose with Bangladeshi mills paying better than other subcontinental markets. The weekly Davis Index for #1 busheling and P&S, Friday cfr Chattogram rose by $25/mt and $24/mt, respectively, from the prior week.
  • Despite high input costs, the weekly Davis Index for domestic billet, Friday, dropped by BDT1,000/mt ex-works Chattogram. Major steelmakers in Chattogram offered discounts on most products to encourage sales.
  • The weekly Davis Index for rebar from medium-scale steelmakers ex-works declined by BDT1,250/mt inclusive of VAT. Large-scale rebar makers maintained their base asking prices for rebar ex-works to keep the spread between scrap and rebar stable. Demand, however, was slow. The index for large steelmakers’ rebar rose BDT1,750/mt from last Friday.
  • There has been an increase in the number of offers for scrapped ships, however, buyers are stepping back as prices are high and incompatible with the local market demand.
  • The increase in prices for shipbreaking scrap equivalent to P&S and domestic HMS 1&2 (80:20) was not in sync with the rise in imported scrap prices. The weekly indexes dropped by BDT1,500/mt and BDT750/mt ex-yards, respectively, on Friday. ($1= BDT84.68)

 

Metallics

 

CIS 

  • The Davis Index for pig iron rose by $8/mt fob Black Sea this week, while the index for Italy rose by $10/mt cfr Italy. No new deals were reported to Italy with mills bidding at $500/mt and offers at $505/mt and higher.
  • Pig iron markets have recorded similar trends with rapid increases with each new booking.
  • Two pig iron sales out of south Brazil concluded this week. One at a price level of $505-510/mt cfr New Orleans, for February shipment. Shortly after that deal a much larger shipment was booked $10/mt above that price level, albeit for prompt shipment.
  • At least one pig iron producer has signaled offer prices significantly higher than the current $490-495/mt cfr level as China remains a strong buyer, as does the US.

 

US

  • The weekly Davis Index for basic pig iron (BPI) increased by another $21/mt cfr New Orleans port on Thursday following recent higher priced bookings to the US.
  • BPI prices have risen by $42/mt since Dec 3 and $120/mt since Nov 5. A similar, widespread six-week price momentum continues across all sectors including steel sales and global exports, along with US domestic scrap and import metal values.
  • Cargos of BPI at $495-500/mt cfr Nola in the past week with buyers receiving offers for BPI at that same level on Dec 17. The new bookings are for April shipment due to the current demand and tightness of the grade.
  • The Davis Index for nodular pig iron (NPI) imports was flat, following a $70/mt rise last week. The grade is in tight supply and should a consumer choose to purchase the material, it would likely not ship until May. The few offers heard for NPI range from $560-580/mt cfr Nola.
  • The weekly Davis Index for US hot briquetted iron (HBI) imports rose by $5/mt cfr Nola. The price estimate is based on import prices from Venezuela tied in with domestic HBI transactions, which are around $10/gt higher than prime scrap grades at production origin sites in Texas or Ohio.

 

India

  • The weekly index for sponge iron increased by Rs1,400/mt del Mumbai mill and by Rs485/mt del Mandi Gobindgarh mill.
  • A mill operator alleged that some sponge iron manufacturers are creating artificial scarcity, which is driving prices up. ($1=Rs73.55)

 

India semi-finished and finished steel

  • The Davis Index for billet in Mumbai surged by Rs1,700/mt ($23.12/mt) from Dec 11 following rebar prices. The index for rebar rose by Rs1,600/mt ($21.76/mt) on strong demand and shortage of material.
  • In Raipur, the daily index for billet increased by Rs1,500/mt ($20/mt) from Dec 11, while the index for rebar spiked by Rs2,000/mt ($27.21/mt).
  • In Mandi Gobindgarh, the index for ingot rose by Rs800/mt ($10.88/mt) from the previous Friday in-line with a rise in local scrap prices.
  • In Chennai, the index for billet was up by Rs2,500/mt ($34.01/mt) on Thursday compared to the previous week in-line with a rise in rebar prices. The index for rebar was up by Rs2,500/mt.
  • In Durgapur, the index for billet rose by Rs1,500/mt on Thursday from last week. ($1=Rs73.51)

 

Shipbreaking 

  • Indian shipbreaking prices rose on Friday. Demand, however, remained weak.
  • The daily Davis Index for 8Ani and 10Ani rose by Rs2,100/mt ($28.56/mt) from the prior week.
  • The indexes for 2kg plates rose by Rs2,250/mt and the index for 5kg plates increased by Rs2,050/mt.
  • The Davis Index for HMS attachments and Melting rose by Rs1,800/mt each. Most buyers stayed away from trades at these levels as they are unsure of finished steel demand sustaining into Jan 2021. ($1=Rs73.55)

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