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

Weak export markets for Indian mills pulled down shredded scrap prices $9/mt from a week earlier in India. Most mills preferred domestic scrap to control costs giving a push to domestic scrap prices this week. Imported scrap prices remained under pressure as mills struggled with slow end-user demand.  


After a long pause for 10 days, Turkish mills resumed bulk bookings for imported scrap for October-November shipments in line with recovering domestic support. The daily index for US-origin HMS 1&2 (80:20) bulk, however, was flat $295/mt cfr Turkey, on Thursday. Recovery in demand could push offers above $300/mt cfr Turkey anticipate suppliers. Despite fewer trades from mills this week, suppliers expect a strong market in October and refused to sell at current levels.  


The daily Davis Index for containerized shredded settled at $308.71/mt cfr Nhava Sheva, down by $1.23/mt from Thursday. From last Friday, the index dropped $9/mt. Bids for shredded were at $305-308/mt cfr Nhava Sheva countering offers of $310-312/mt cfr Nhava Sheva on Friday. A mill bought shredded at $317/mt cfr Vizag equivalent to $308-310/mt cfr Nhava Sheva. Prices are down $15/mt in the last 10 days in line with weak domestic scrap prices.  


In the bulk market, no trade for US-origin HMS 1&2 (80:20) materialised as buyers were not in a position to bid above $300-305/mt cfr Kandla against firm offers of $315-320/mt cfr Kandla on Friday. The gap between offers and bids widened further. A shortage of oxygen forced many recycling yards and steelmakers to suspend operations, which also brought down buying interest. Non-availability of bulk resulted in more trades in containers this week.  


The weekly Davis Index for UK/Europe-origin HMS 1&2 (80:20) settled at $291/mt cfr Nhava Sheva, down by $3/mt from the prior week, trades reported at index price. Offers for UK-origin HMS 1&2 (80:20) were at $295/mt cfr Nhava Sheva on Friday after a few yards found easing supply on higher collection rates.  


The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $292/mt cfr Nhava Sheva Friday, down by $1/mt from Thursday and $6/mt from a week earlier. Offers for Dubai-origin HMS 1&2 (80:20) were at $295/mt cfr Nhava Sheva though trades were only at $290-292/mt cfr Nhava Sheva on Friday. #1 HMS scrap from Dubai yard booked at $300/mt cfr Nhava Sheva.


The index for US-origin HMS 1&2 (80:20) settled Friday at $292.5/mt cfr Nhava Sheva, down by $4.25/mt from last Friday. Trades for the US-origin HMS 1&2 (80:20) were at $290-293/mt cfr Nhava Sheva. But most suppliers believe the downside is limited and ferrous scrap prices could receive support in October when demand recovers. The possibility of a second wave of COVID-19 in Europe and UK markets and election in the US market in November adds to uncertainly in the market.


The index for South African HMS 1&2 (80:20) settled at $290/mt cfr Nhava Sheva, down by $5/mt from the prior week. South African sellers offered #1 HMS at $295/mt cfr Nhava Sheva for 25-26mt loading on Friday.  


In Goa, domestic volatility kept steel mills away from trades. Bids from mills were around $275-280/mt cfr pulling the index for HMS 1&2 (80:20) down $3/mt to $285/mt cfr Goa. A few containers of TEU of West Africa-origin HMS 1&2 (80:20) traded at $280-285/mt cfr Mundra this week.  


Trades for HMS 1&2 (80:20) from Australia were reported at $295/mt cfr Chennai depending on quality. Most Brazilian suppliers were targeting high prices from Indian buyers amid high realisations in the domestic markets. The weekly indexes for higher grade scrap like busheling and P&S traded in very limited volumes. Indexes were at $326/mt cfr and $315/mt cfr Nhava Sheva, down $7/mt and $5/mt, respectively, from the prior week. Buyers could show interest in premium grades once the domestic market turns bullish, said a trader.


Turning scrap buying inquiries increased this week amid a drop in HMS prices. The weekly index for Turning scrap was at $270/mt cfr Nhava Sheva, down $10/mt from last week. A trader offered Turning at $265-270/mt cfr Chennai on Friday. Buyers are keen to close deals in a hurry amid indications of a price rise in the next few weeks.  



The Davis Index for containerized shredded, Friday, settled at $303.91/mt cfr India subcontinent, down $2.66/mt from Thursday, while down $7/mt from a week earlier. The daily Davis Index for containerized US-origin HMS 1&2 (80:20) settled at 288.24/mt cfr India subcontinental, down $1.52/mt from Thursday.  



The daily index for US-origin containerized HMS 1&2 (80:20) Friday dropped by $2/mt to $275/mt cfr Taiwan on Friday. Mills bids at $270-273/mt cfr Taiwan in line with a drop in domestic scrap prices on Friday. Also, demand for finished steel remains weak. Suppliers, however, expect higher prices next week following strengthening sentiments in Turkey.


Japanese export offers have reduced by JPY1,000/mt or $10/mt over this week amid weak demand in Taiwan and other East Asian markets. 




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