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

Pakistani ferrous scrap importers continued active inquiries for imported scrap amid depleting inventories. Most traders are back in the market to take positions and are expected to stay active until mid-April. Rising domestic scrap prices and appreciation of the Pakistani rupee against the US dollar boosted appetite for imported scrap. The Pakistani rupee appreciated 152.67 against the dollar, the highest since March 2020. 


The Davis Index for containerized shredded, Wednesday, settled at $438.75/mt cfr Port Qasim, up by $2.50/mt from Tuesday. Mills booked shredded at $435-437/mt cfr Port Qasim. Suppliers’ expectations jumped following high global bulk prices. Offers for shredded from the UK and EU ranged between $440-450/mt cfr Port Qasim on Wednesday. Most mills are waiting for clarity on new freight rates effective April. 


After a long pause, traders returned to the market hoping that mills will restock ahead of Ramadan. While a few mills are still watchful as rebar sales have not picked up since February and the second wave of COVID-19 in South Asia also dampened sentiment.


In Turkey, the depreciation of the local currency Lira to above 8.2 against the dollar pulled bids down. Offers for US HMS 1&2 (80:20), though, remained at around $427-430/mt cfr Turkey. 


The daily index for US-origin HMS 1&2 (80:20), Tuesday, settled at $417.5/mt cfr Port Qasim, up by $2.5/mt from Tuesday. Bookings were planned to secure deliveries before the Ramadan holidays and a slowdown in logistics. Most mills expect active demand post-Ramadan and they might have to book more materials during Ramadan for post-Eid or mid-May deliveries due to low inventories on hand. Historically, Ramadan has been a very sluggish month for trades. 


Rising buying interest pushed #1 HMS and P&S offers from UAE to $425-435/mt cfr Port Qasim, depending on quality. The daily Davis Index for UAE-origin HMS 1&2 (80:20) settled at $418/mt cfr Port Qasim, up by $3/mt from Tuesday. A few trades were at $418-420/mt cfr Port Qasim on improving demand. There is a shortage of materials in the UAE amid active domestic demand.


Domestic steel prices rise

On Wednesday, Bala billets traded at PKR107,000-107,500/mt ex-works Lahore, higher by PKR500/mt than a day ago. Offers for G-60 billet were stable at PKR111,000-111,500/mt ex-works Punjab. 


Although steelmakers are attempting to raise asking rates for rebar, limited demand pressured prices. Rebar offers remained at PKR135,000/mt ex-works Karachi. In Punjab, it traded at PKR131,000-131,500/mt ex-works, marginally up PKR500/mt. Local rebar offers at PKR120,000/mt ex-works Punjab held prices steady. 


Domestic steel demand has been slower-than-expected for over a month causing many furnaces in Punjab to either shut operations or cut production by 50pc. A supply cut could support steel prices. 


Domestic scrap 

Prices for Art Q toke scrap equivalent to a mix of HMS and P&S, Wednesday, rose by PKR500-1000/mt to 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, up PKR500/mt from a day prior. 


Delays in imported scrap deliveries amid shipping line issues are driving domestic scrap trades in Pakistan. In Gadani, offers for scrapped vessels ranged from $460-480/ldt cnf amid improved sentiments. Ship melting scrap prices rose above PKR88,500-89,000/mt ex-yards on tight supply. 



Leave a Reply

Your email address will not be published.