Bangladesh: Imported ferrous scrap market remains sluggish; few containerised deal seen w-o-w

The imported ferrous scrap market in Bangladesh is currently experiencing a sluggish phase with limited containerised deals in PNS, shredded, and busheling loose grades. The slow domestic finished steel market, compounded by low construction activities during the monsoon season, is further contributing to the lacklustre market conditions.

Buyer sources indicate that the market is not fully active and smooth. While some bulk deals are taking place, the issue of letters of credit (LCs) is causing delays in container bookings.

"Bulk offers for Europe HMS (80:20) are at $410/t, similar from Australia. Meanwhile, US HMS bulk is offered at $413-415/t. However, buyers have not made any purchases in the past week due to weak demand caused by LC issues and the rainy season," a major mill official said.

Recent deals indicate that offers for US-origin bulk scrap into Bangladesh are in the range of $410-415/t. Hong Kong has been the main source for various grades like shredded, PNS and busheling, with prices ranging from $445-455/t on a CFR Chattogram basis.

As per market sources, US and Australia HMS (80:20) bulk offers are at $410-415/t, while US HMS (80:20) in containers are at $415-420/t. US-origin shredded in containers are at $430-444/t and Japanese-origin H2 bulk offers hover at $405-410/t CFR levels.

Interestingly, major steel mills did fail to conclude bulk cargo from Japan's Kanto scrap export tender, which concluded at JPY 49,740/t ($354/t) FAS, for 5,000 t of H2, yesterday.

Fresh offers

• Offers for US-origin bulk scrap remain range-bound at $412-415/t CFR.
  
  
• Japanese-origin H2 prices remain at around $405-410/t CFR, amid a weakened Japanese yen.
  
  

The assessment for UK-origin shredded scrap stands at $435-440/t CFR Chattogram, showing a slight decrease of $6-8/t w-o-w according to SteelMint.

Domestic market slump

In the domestic market, major mills are not actively participating due to low production levels and limited scrap consumption. They are waiting for LC approvals and exploring alternative origins like Hong Kong and Australia.

Local ship-breaking scrap prices remained largely stable at BDT 60,000-62,000/t ($553-572/t) exy.

In terms of domestic steel prices, rebar in Chattogram is priced at BDT 96,000-98,000/t($882-900/t), while in Dhaka, it ranges from BDT 89,000-91,000/t($817-836/t). There is a possibility of a BDT 1,000/t discount for Chattogram rebar from specific mills, but most are selling in a range of BDT 96,000-98,000/t, SteelMint learnt.

The Bangladeshi Taka traded at around 108.87 against the US dollar at the time of reporting, largely stable w-o-w.

Outlook

The imported ferrous scrap market in Bangladesh is expected to remain sluggish in the near term. Major mills are likely to remain cautious and rely on banks for LC approvals. However, uncertainties surrounding LC issues and the rainy season may continue to dampen demand and keep the market subdued.