“Bangladeshi mills are getting more urgent to buy compared with a few weeks back. Feedstock will run low but so far, they have been resistant to book fresh bulk cargoes. It is now a game of chicken to see who will blink first,” a South Asian scrap trader said.
“One buyer has been talking to bulk sellers for a while but not buying – I assume they will have to book at some point soon, while another two mills are also discussing cargoes but I haven’t heard any numbers from their negotiations,” a second South Asian trader said.
The last confirmed bulk deep sea deal done to Bangladesh took place in early November from the United States’ West Coast at $336 per tonne cfr for HMS 1&2 (80:20), although there are rumors that an Australian cargo of 20,000 tonnes was sold to a consumer at $410 per tonne cfr for HMS 1&2 (80:20) and $425 per tonne cfr for shredded in early December.
No fresh offers were heard in the market given that key supplier markets such as the US and Australia are on Christmas and New Year holidays, but sources said that $500 per tonne cfr Bangladesh would be a fair price for bulk, deep-sea HMS 1&2 (80:20).
Fastmarkets’ price assessment for bulk cargoes of steel scrap, HMS 1&2 (80:20), deep-sea origin, import, cfr Bangladesh was $500 per tonne on Thursday, unchanged week on week.
Fastmarkets’ price assessment for bulk cargoes of steel scrap, shredded, deep-sea origin, import, cfr Bangladesh was $510 per tonne on Thursday, also unchanged from the week before, with a shortage of shredded scrap maintaining the $10-per-tonne premium over HMS 1&2 (80:20) compared with the usual $5-per-tonne premium.
“It will be interesting to see if Bangladeshi mills buy above the psychological barrier of $500 per tonne cfr for deep sea bulk HMS 1&2 (80:20). I think we may have seen the peak of the markets now – we shouldn’t see any sharp drops, but things might stay flat,” the second South Asian source said.
“There is a lack of activity at the moment and I doubt that things will happen next week either. Typically the first week of the month is filled with domestic settlements and if US domestic prices rise again, I expect more focus on local sales rather than exports,” an exporter said.
Sources in the US have told Fastmarkets they expect steel scrap contract prices to rise again in January amid strong domestic and export demand.
Containerized prices dwindle
Unlike the firm bulk deep sea markets, prices for containerized scrap imported to Bangladesh inched down over the last week with traders showing willingness to accept slightly lower numbers.
HMS 1&2 (80:20) in containers from the United Kingdom was heard offered at $450 per tonne cfr Bangladesh late last week, with UK traders said to be willing to accept as low as $448 per tonne cfr.
A sale was heard for mixed-origin HMS 1&2 (80:20) at $455 per tonne cfr Bangladesh, while a bid for similar material was heard at $445 per tonne cfr.
Fastmarkets’ price assessment for steel scrap, HMS 1&2 (80:20), containerized, import, cfr Bangladesh was $448-455 per tonne cfr on Thursday, down by $5-7 per tonne from $455-460 per tonne cfr a week earlier.
Shredded scrap in containers was heard sold at $470 per tonne cfr Bangladesh over the past week, while plate and structural (P&S) from the UK was sold at $475 per tonne cfr. Other suppliers indicated to Fastmarkets that they would not accept less than $475 per tonne cfr for shredded this week.
Therefore, Fastmarkets’ price assessment for steel scrap, shredded, containerized, import, cfr Bangladesh was $468-475 per tonne on Thursday, widening downward by $2 per tonne from $470-475 per tonne the week before.
Bangladeshi steelmakers are likely to re-enter the market soon for purchases of deep-sea scrap cargoes due to low inventory levels, sources told Fastmarkets on Thursday December 31.