Bangladesh: Bulk ferrous scrap imports fall over 10% m-o-m in Nov'24

• Weak steel demand prompts output cuts
  
  
• Imports from Japan nearly triple m-o-m
  
  

In November 2024, bulk ferrous scrap imports to Bangladesh declined by 13% to 366,752 tonnes (t) from 419,519 t in October 2024. Notably, October saw a 31% m-o-m increase from 319,779 t in September.

Meanwhile, in the first 11 months of 2024 (11MCY'24), imports surged 14% y-o-y to 3.3 million tonnes (mnt) from 2.9 mnt in the same period last year.

Notably, the m-o-m rise in October could be attributed to the fact that material originally booked in July and August finally arrived in October due to delays in letter of credit (LC) processing.

Conversely, the decline in November was primarily due to dry demand in the local steel market, which caused mills to operate at 50-60% of their capacity or even below this level.

Bangladesh's steel production has dropped, and as per industry reports, the country's consumption of the same has been declining for over a year, despite initial expectations of growth, driven by infrastructure projects and individual demand.

The government, which traditionally accounts for 60-65% of the 7.5 mnt of annual demand, has halted public construction since the Awami League administration's ouster, slashing its demand for steel to nearly zero over the past three months.

Amid political unrest and inflation above 9%, real estate activity has slowed, further impacting demand. Many mills have shut down furnaces, with producers selling below cost to cover expenses.

BigMint's monthly average price assessments

• US-origin bulk HMS (80:20) declined to $377/t CFR Chattogram in November as against $382/t CFR in October.
  
  
• Japanese-origin bulk H2 fell to $366/t CFR Chattogram in November as against $368 t CFR in October.
  
  

Country-wise breakup

US: In November 2024, volumes from the US plunged 62% m-o-m to 99,199 t from 258,373 t in the preceding month. Notably, October 2024 witnessed a 64% m-o-m surge, with imports rising to 258,373 t from 157,677 t in September.

When compared to the year-ago period, imports in November 2024 fell 23% from 128,156 t.

Imports in October 2024 recorded a significant 80% increase compared to the corresponding period last year (CPLY), from 143,344 t. Crude steel production in the US declined slightly by 2%, from 6.65 mnt in September to 6.55 mnt in October, potentially contributing to an increase in ferrous scrap exports.

In 11MCY'24, imports rose 27% to 1.55 mnt from 1.22 mnt in the same period of 2023. Similarly, in 10MCY'24, imports increased by 34% y-o-y to 1.44 mnt from 1.08 mnt in the CPLY.

Japan: In November 2024, imports from Japan nearly tripled to 152,267 t from 53,752 t in October 2024.

In October 2024, imports from Japan decreased slightly by 2% to 53,752 t from 54,629 t in the preceding month.

In 11MCY'24, imports surged 29% to 0.53 mnt from 0.41 mnt in 11MCY'23. Similarly, in 10MCY'24, imports increased by 17% to 0.38 mnt from 0.32 mnt in the CPLY.

New Zealand: In November 2024, shipments from New Zealand touched 49,060 t, a 77% increase from 27,786 t in October 2024, following nil imports in September.

In 11MCY'24, imports surged 14% to 0.25 mnt from 0.22 mnt in 11MCY'23. Similarly, in 10MCY'24, imports increased by 18% to 0.19 mnt from 0.16 mnt in CPLY.

Australia: In November 2024, Bangladesh's imports from Australia reached 21,947 t, a 25% decrease from 29,295 t in October 2024. In a similar vein, October 2024's scrap import volume declined 36% from 45,598 t in September 2024.

Notably, crude steel production in Australia increased by 13%, to 0.4 mnt in October from 0.35 mnt in September. This rise in production may have led to a reduction in ferrous scrap exports.

In 11MCY'24, imports surged 21% to 0.4 mnt from 0.33 mnt in the CPLY. Similarly, in 10MCY'24, imports increased by 33% to 0.38 mnt from 0.28 mnt in 10MCY'23.

Outlook

Prominent market players believe that without a recovery in the construction sector, the steel industry will remain under pressure, likely keeping imported scrap inflows sluggish in the subsequent months.