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

Pakistan ferrous scrap importers paused trades amid growing uncertainty and high offers. South Asian markets are struggling with the resurgence of COVID-19 and dampening demand while global steel prices continued to chart new highs. Buyers were reluctant to book materials amid slow finished steel demand.


The Pakistani government has warned of a stricter lockdown and has extended restrictions, as per the new guidelines. All businesses are allowed to operate only five days a week, while commercial activities will be closed by 8:00pm in areas with an infection ratio greater than 8pc.


The Davis Index for containerized shredded, Monday, settled at $464.5/mt cfr Port Qasim down $0.5/mt from Friday. There are hardly any new deals since Friday when significant volumes were traded at $463-465/mt cfr Qasim, said importers. Though freight rates have marginally adjusted this week, availability is still tight.


In Turkey, mills continued May and June bookings amid healthy orders for rebar and billets. Increased buying in Turkey could reduce offers to South Asian markets.  


The Pakistan Association of Large Steel Producers (PALSP) has urged the government to not increase power tariffs for the steel sector. The government has planned to increase tariffs by 5pc before October 2021. According to IMF’s suggestion, the announcement of an increase of PKR65 per unit has been put forward which could lift the cost of electricity by as high as 36pc.


The daily index for US-origin HMS 1&2 (80:20), Monday, settled unchanged at $437.50/mt cfr Port Qasim. Offers at $440-445/mt cfr Qasim while mills were largely inclined to purchase short transit UAE-origin HMS. Offers for mixed #1 HMS and P&S from UAE remained stable at $450-455/mt cfr Port Qasim, depending on quality. The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $443/mt cfr Port Qasim unchanged in absence of major trades. Offers remained high amid short supply and higher domestic rebar prices.


Domestic scrap prices flat

On stable demand, prices for Art Q toke scrap equivalent to a mix of HMS and P&S, Monday, reported at PKR87,000-87,500/mt ex-yard Lahore. Trades for Pure Q toke scrap equivalent to shredded were at PKR88,500-89,000/mt ex-yard Lahore.


In Gadani, recyclers resisted scrapped vessels or container carriers deals. Offers remained stable at $470-480/mt cnf Gadani.


Billet up on high input costs

On Monday, Bala billets offered at PKR108,000-108,500/mt ex-works Lahore, up PKR500/mt from prior week. Prices, however, remained rangebound for almost three weeks now. Offers for G-60 billet were stable at PKR112,500-113,000/mt ex-works Punjab.


Long steelmakers in Punjab and Karachi kept offers firm, despite weak demand. Rebar offers remained at PKR135,000-136,000/mt, ex-works Karachi, while in Punjab, rebar traded at PKR131,000/mt ex-works Punjab.



Leave a Reply

Your email address will not be published.