BANGLADESH STEEL SCRAP: Low inventories prompt rush for container deals

Import prices for steel scrap to Bangladesh continued to rise during the week to Thursday May 20, with buyers increasingly searching for tonnages, sources told Fastmarkets.

Poor local steel prices, the country’s ongoing Covid-19 crisis, and the holy month of Ramadan had kept Bangladeshi mills out of the market for scrap imports in recent weeks.

But the lack of buying, together with the country’s largest mills continuing to produce steel at high capacity utilization rates, meant that scrap inventory levels are dropping below acceptable levels, sources said.

Offers were mostly at $545-555 per tonne cfr Bangladesh for deep-sea heavy melting scrap 1&2 (80:20) from the United States West Coast over the past week, with no deals done since buyers were unwilling to pay more than $525 per tonne cfr at the time of price assessment on Thursday.

A South Asian trader said he had received a bid at $520 per tonne cfr Bangladesh for deep-sea shredded scrap this week, but this was far too low to be workable.

Fastmarkets’ price assessment for bulk cargoes of steel scrap, HMS 1&2 (80:20), deep-sea origin, import, cfr Bangladesh was $530-540 per tonne on Thursday, up by $10-15 per tonne from $520-525 per tonne a week earlier.

Exporter sources told Fastmarkets they did not expect any sales imminently, but buyers in Bangladesh may become desperate and could pay higher prices.

Fastmarkets’ price assessment for steel scrap, shredded, deep-sea origin, import, cfr Bangladesh was $535-545 per tonne on Thursday, also up $10-15 per tonne week on week from $525-530 per tonne previously.

Container sales rise sharply

Although Bangladeshi mills have been unable to obtain deep-sea shipments, they have been active in buying containers of scrap in the past seven days.

“Bangladesh is maximizing container bookings now. Container offers are in greater number from traders in the market and container availability has eased a little,” a key exporter source told Fastmarkets.

Bangladeshi mills are chasing scrap despite a poor local market, the exporter source said, with rebar prices being hammered by low demand in the local retail market caused by the ongoing battle with Covid-19. Rebar prices in Chattogram were heard at 70,000-71,000 Bangladeshi taka ($812-823) on Thursday.

He added that mills would have to either consider reducing output in the coming weeks or would have to keep raising their intake of steel scrap.

HMS 1&2 (80:20) in containers was sold at $515 per tonne cfr Chittagong at the start of the week, with deals rising to $520-525 per tonne cfr by the middle of the week, sources said.

Fastmarkets’ price assessment for steel scrap, HMS 1&2 (80:20), containerized, import, cfr Bangladesh was $515-525 per tonne cfr on Thursday, up $19-25 from $496-500 per tonne cfr a week earlier.

Shredded scrap was heard to have started the week with deals at $540 per tonne cfr Bangladesh, eventually rising to deals as high as $552 per tonne cfr from origins including the United Kingdom.

The price assessment for steel scrap, shredded, containerized, import, cfr Bangladesh was $540-552 per tonne on Thursday, up from $510 per tonne a week earlier.

Strong demand for low-impurity scrap in the country led to a rise in sales done for busheling and bundles. Mills have been unable to source Shindachi busheling from Japan in recent weeks amid restrictively high prices, sources said, leading to more interest in containers of high-yield material.

UK-origin busheling scrap in containers was heard offered at $585-590 per tonne cfr Bangladesh, while blue steel in boxes was heard sold at $560-565 per tonne cfr.

Brazil-origin light melting steel scrap bundles was also sold at $540 per tonne cfr Bangladesh on Wednesday.

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