Bangladesh: Bulk ferrous scrap imports fall by 20% m-o-m in Aug'24
...
Bangladesh, a leading importer of bulk scrap in South Asia, saw a drop in its bulk ferrous scrap imports in August 2024. The country imported 0.32 million tonnes (mnt), a 20% decrease from the previous month's 0.39 mnt.
However, the import volume witnessed a substantial increase y-o-y compared to August 2023, when imports were just 0.07 mnt.
Factors behind the drop
- The absence of Australia and New Zealand-origin bulk scrap export volumes has significantly reduced Bangladesh's ferrous scrap imports.
- Bangladesh faced severe flooding and political turmoil in August, which disrupted logistics and delayed shipments.
Country-wise breakup
Imports from Japan fall: Bangladeshi importers procured approximately 40,506 tonnes (t) of ferrous scrap from Japan in August, a sharp decrease of 52% compared to the 84,772 t imported in July. Compared to the same period last year, imports were down by 8% from 44,012 t.
The significant drop in volume was largely due to the absence of Bangladeshi buyers in July's Kanto tender. Bangladeshi buyers remained on the sidelines in the imported ferrous scrap market due to local student protests, and higher freight costs particularly in the Far East (Japan) followed by limited domestic steel demand. This led major steelmakers to hold back on fresh bookings.
However, from January to August 2024, imports increased by 4% y-o-y from 260,000 t in 7M CY'23 to 270,000 t in this year.
Imports from Indonesia fall: In August, scrap imports from Indonesia totalled 38,890 t, saw a decrease of 10% m-o-m compared to 43,327 t in July 2024.
Imports from the Netherlands remain stable: Bulk scrap imports from the Netherlands remained stable in August 2024 at 41,644 t, a marginal 1% m-o-m drop compared to 41,977 t in July.
However, from January to August 2024, imports increased by 100% y-o-y from 40,000 t in 7M CY'23 to 80,000 t in this year.
Imports from the US rise: August saw a significant increase in bulk scrap imports from the US, with a nearly 58% rise to 198,192 t from July's 125,653 t. Compared to the same period last year, imports were up by 82% from 70,320 t.
However, from January to August 2024, imports increased by 27% y-o-y from 810,000 t in 7M CY'23 to 1,03,000 t in this year.
Price trends
- BigMint's monthly average price assessment for US-origin bulk HMS (80:20) stood at $395/t CFR Chattogram in August as against $405/t CFR in July.
- BigMint's monthly average price assessment for Japan-origin bulk H2 stood at $398/t CFR Chattogram in August as against $400/t CFR in July.
Outlook
Bangladesh's ferrous scrap import volumes are expected to decline in the near term, particularly in bulk shipments, due to challenges in opening letters of credit (LC) amid weaker foreign reserves. This, combined with lower steel demand and reduced construction activities during the monsoon season, will likely keep major steelmakers away from pursuing fresh bookings. While some short-term fluctuations in import volumes may occur, the long-term trend points to a less stable market, with recovery dependent on stable political decisions for the steel industry.
