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

Despite an uptick in domestic steel prices, importers are yet to resume trades. The gap between domestic and imported scrap narrowed in the past week, mills continued to focus on domestic scrap. 


Although supply of HMS scrap has eased internationally, some yards reported tight supply. Meanwhile, container shortages reduced traders’ chances of procuring materials at lower prices.


The daily Davis Index for containerized shredded on Thursday, slipped by $1/mt to $535.5/mt cfr Nhava Sheva amid a lack of buying interest. Most traders kept offers for shredded firm around $540/mt cfr Nhava Sheva against bids that lagged by a minimum of $10/mt. 


The daily Davis Index for UAE-origin HMS 1&2 (80:20) remained unchanged at $470/mt cfr Nhava Sheva. Most UAE-based sellers could return to the market next Monday.   


In Alang’s shipbreaking market, melting scrap prices rose further as demand surged. Trades heard at Rs36,800/mt ($494/mt) ex-yards.


The price for imported HMS was offered at $470/mt cfr Nhava Sheva, which translated to above $495-500/mt after the addition of handling and local transportation charges on a delivered mill basis. A gap of over $25/mt between domestic and imported scrap made the latter expensive for many secondary buyers in India. 


Demand for finished long steel and consequently imported scrap could recover in the next couple of weeks once the peak of monsoon season passes. In Mumbai, rebar offers were flat for the last two days at Rs48,100/mt ex-works. In Mandi Gobindgarh, ingot traded above Rs45,500-46,600/mt ex-works.


In line with domestic fundamentals, Indian mills kept billet export offers above $625-630/mt fob. Chinese buyers could continue billets imports to become a net importer in the coming months amid production cuts and strict monitoring by authorities. 


Exporters in China were unwilling to participate in negotiations amid rumours of export taxes. While in the domestic market, rainstorms in the Henan province led to uncertain sentiments as steel prices in HRC and rebar remained flat. 


International iron ore Fe 62pc in the spot market dropped by $7/mt to $213.06/mt cfr North China, on Wednesday. Meanwhile, domestic billet prices stayed flat at CNY5,180/mt ex-Tangshan inclusive of VAT. Following a sharp drop in iron ore, a few mills lowered domestic ferrous scrap purchase bids by up to CNY300/mt in China. 



The daily Davis Index for containerized shredded settled at $540.12/mt cfr Indian subcontinent, down by $0.48/mt, while the daily Davis Index for containerized US-origin HMS 1&2 (80:20) settled at $496.22/mt cfr Indian subcontinent, down by $1.25/mt. 


In South Asia, trades for imported shredded remained scarce owing to Eid-Al-Adha holidays and demand in India for the same is yet to recover. 

($1=Rs74.59; CNY6.47)


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