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

Imported ferrous scrap trades to India resumed in thin volumes as some offers matched bids. But in the board market, there continues to be a wide disparity between offers and buying interests. Trades for imported scrap are expected to pick up amid low inventories and disruptions in domestic scrap supplies. 


In Mandi Gobindgarh, India’s biggest hub for scrap and steel trade, the local steel association has called for a halt of production and purchase of scrap as a mark of protest against GST compliance challenges faced by local mills. The association has asked mill owners to close production and purchase of scrap for 48 hours, from March 17, 8:00am to March 19 8:00am, for 8:00am. The scrap dealer’s association has demanded the government’s intervention to resolve their GST-related issues. Domestic scrap prices and supplies are likely to be hampered by this industrial action if mills agree to comply. 


Importers opted for HMS trades from Dubai, East Africa, and Australia with shorter transit time amid uncertainty due to the second wave of COVID-19 restrictions in many states.


A few suppliers were desperate to sell before prices drop further and a few trades reported in Pakistan. Now prices should turn around as there is a limited downside left amid strong domestic fundamentals and steady rebar demand, claimed traders.


The daily Davis Index for containerized shredded settled at $430/mt cfr Nhava Sheva, down by $3.75/mt from Friday. Prices dropped to over a-month low. On Friday, a stainless steelmaker booked shredded at the equivalent of $435/mt cfr Nhava Sheva yet offers from yards and traders remained $10-15/mt higher than buyers’ expectations. 


In Turkey, after active buying, the appetite for imported scrap cooled off. Negotiations for HMS 1&2 (80:20) in bulk could be around $435/mt cfr Turkey. Rebar export offers have remained stable at $640-645/mt fob Turkey.


The daily Davis Index for UAE-origin HMS 1&2 (80:20), Monday, settled at $395/cfr Nhava Sheva, down by $4/mt. Buying interest on Monday was around $390-395/mt for the grade as most furnaces in North and West India continued to resist high offers and opted for domestic supplies. On Monday, a few offers for Dubai-origin HMS #1 and P&S were at $410-415/mt cfr Nhava Sheva against bids at $400-405/mt cfr Nhava Sheva. 


The daily index for US-origin HMS 1&2 (80:20), Monday, was at $410/mt cfr Nhava Sheva, down by $5/mt. Offers for West African HMS for 20-21mt loading with CI-GI above $375-380/mt cfr Nhava Sheva.


Following increased construction activities rebar demand has been strong in the country. Shipbreaking melting scrap prices in Alang, Monday, remained stable at Rs31,000/mt ex-Alang after losing Rs300-400/mt on Saturday. 


In China, steel futures continued to hover by 4-5pc. On Friday, imported iron ore with 62pc Fe content traded above $165/mt cfr North China. Domestic billet prices in the retail market increased further by CNY40/mt to CNY4,460/mt ex-Tangshan, including VAT. Tangshan government continues with stricter restrictions and has asked many mills to cut production lifting steel prices. 



On Monday, the daily Davis Index for containerized shredded dropped to $430.77/mt cfr Indian subcontinent, down by $4.53/mt. The daily index for containerized US-origin HMS 1&2 (80:20) settled at $416.39/mt cfr Indian subcontinent, down $5.09/mt from Friday. Containerized freight rates from the US east coast, New York to South Asian markets reported flat.



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