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

Demand for imported ferrous scrap and cast-iron rotors in India improved but remains below sellers’ expectations. Scrap prices are under pressure and could attract more buyers. The gap between domestic and imported material has also narrowed. Some market participants expect steel demand to recover and spur imported scrap deals. 


On the other hand, the risk of a potential third wave of COVID-19 in India has instilled uncertainty in the market. 

The daily Davis Index for containerized shredded on Wednesday dropped by $3.5/mt to $528.25/mt cfr Nhava Sheva. Offers for shredded from the UK/EU and the US were at $530-535/mt cfr Nhava Sheva, but buyers were interested at prices below $520-525/mt cfr Nhava Sheva on Wednesday. 


The weekly Davis Index for cast iron, rotors, and drums, Wednesday, settled at $508/mt cfr Nhava Sheva, down by $5/mt from July 28. The asking prices were at $515-525/mt cfr Nhava Sheva, but buyers refused to accept above $505-510/mt cfr Mundra. Softening prices in supplier countries for ferrous grades weighed demand for cast iron rotors too. 

In the domestic market, cast iron toka scrap traded in Mandi Gobindgarh at Rs36,000/mt, while imported cast scrap was at Rs37,000/mt ($498/mt) delivered mills. 


The daily Davis Index for UAE-origin HMS 1&2 (80:20) declined by $1/mt to $468/mt cfr Nhava Sheva. Offers from UAE sellers remained firm but Indian buyers continued to bid lower. Imports could resume with the gap between imports and domestic scrap narrowing. For the UAE origin #1, HMS offers on Wednesday were at $480-485//mt cfr Chennai. Despite a drop of $10-15/mt, mills are awaiting a further drop. 

Steel producers are expecting a slight recovery in demand as the rainfall recedes. Steelmakers are eyeing around Rs2,000/mt hike in steel prices for August shipments. 


The daily Davis Index for US-origin HMS 1&2 (80:20) settled unchanged at $477.5/mt cfr Nhava Sheva.  

The transporters’ strike continued in Alang’s shipbreaking market. Domestic scrap prices were mixed as supplies remain tight. In Mumbai, the asking rates for rebar climbed by Rs100/mt to Rs49,800/mt ex-works. In Mandi Gobindgarh, ingot prices were at Rs46,300/mt ex-works. Improving domestic fundamentals led to a positive outlook for imported scrap. 


International iron ore Fe 62pc prices continued to strengthen in the spot market reaching $184.15/mt cfr North China on August 3, up by $0.75/mt from a day prior. On Wednesday, iron ore futures trended up amid hopes of demand rising. 


In China, the domestic billet prices were unchanged on Wednesday at CNY5,100/mt ($789.25/mt) ex-Tangshan inclusive of VAT. HRC and rebar futures moved up to CNY5,750/mt and CNY5,355/mt in the closing session on Wednesday. Domestic spot steel prices for rebar rose by CNY50/mt and HRC by CNY100-150/mt. 

Indian mills have turned cautious amid weak cues from China. Offers for billets dropped to $680-700/mt cfr China, with no buying interest. 


The daily Davis Index for containerized shredded settled at $531.68/mt cfr Indian subcontinent on Wednesday, down $3.63/mt, while the daily Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $486.75/mt cfr Indian subcontinent, down by $2.88/mt. 


($1=Rs74.15; CNY6.46)


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