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

US containerized ferrous scrap indexes increased on the West Coast for the third straight week. Containerized scrap on the East Coast rebounded by $8-13/mt this week, in contrast to a rangebound trend last week.


Sellers report an active export market as buyers increase inquiries given the fear of continued higher export prices as well as slightly higher production needs at mills. Shredded and P&S 5ft containers being quoted at comparable prices for the second consecutive week. Higher import scrap prices to Turkey buoyed the global scrap market sentiment.


The weekly Davis Index in New York for #1 busheling increased by $10/mt to $263/mt fas while HMS 1&2 (80:20) went up by $8/mt to $240/mt fas. The index for P&S 5ft rose by $13/mt to $260/mt fas and surged for shredded by $11/mt to $257/mt fas. The index for machine shop turnings, which tends to encounter wider changes depending on interest, inched up by $1/mt to $203/mt fas.


Pakistan and Bangladesh slowed their inquiries towards the end of last week due to a holiday but could increase again later this week. The West Coast continued benefiting from active Asian buyers who wish to secure September deliveries. 


Mills in Indonesia, Vietnam, Pakistan, and other locations believe that recovery will continue into Q3 2020 with the return of some infrastructure projects and resurrection of consumer demand supporting additional steel production. South Korean buyers are waiting for more clarity in domestic finished steel markets prior to making additional import commitments at higher prices. 


Japanese scrap export offers increased for small bulk, large bulk, and containerized shipments. The increased scrap prices are supported by higher price movements in most domestic markets of buying mills as well as competing scrap from Australia, Russia, and the EU. 


US containerized scrap prices are supported by Japanese scrap price movements, but some buyers are holding back in anticipation of a correction in the short term. Some sellers believe that present scrap prices will likely remain through August with the US domestic scrap price expectations in the early August expected to trade soft sideways, domestic scrap prices at destination countries increasing, and expectations for global steel sales improvements in September and October. 


The weekly Davis Indexes in Los Angeles for #1 busheling increased by $4/mt to $243/mt fas. The index for HMS 1&2 (80:20) rose more robustly by $7/mt to $229/mt fas and P&S 5ft and shredded both increased by $4/mt to $242/mt fas each. P&S 5ft and shredded scrap have maintained equal pricing levels through the three-week increase.


The Davis Indexes in San Francisco followed Los Angeles for HMS 1&2 (80:20) but remained rangebound for other grades. #1 busheling was flat at $238/mt fas, while HMS 1&2 (80:20) rose by $5/mt to $223/mt. The index for P&S 5ft increased by $1/mt to $235/mt fas alongside shredded which also increased by $1/mt to $235/mt fas.

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