Bangladesh: Imported ferrous scrap prices rise w-o-w as trading gathers momentum
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Imported ferrous scrap offers into Bangladesh witnessed a slight uptick for bulk prices while remaining range-bound for containerised scrap with a steady rise in fresh deals from Australia, New Zealand, the UAE, the US and Brazil.
Due to better LC opening chances, multiple bookings from Australia and America were reported last weekend. Higher freight rates from Malaysia and Hong Kong are deterring buyers, making Australia a more attractive option. The fiscal year-end in Australia in June prompted quick bookings, with suppliers focusing on Bangladesh and India for prompt shipments. Consequently, Australia is emerging as a favourable sourcing destination.
Scrap offers/indicatives
According to a major trade source, Bangladesh buyers are actively inquiring about materials from the UAE, Australia, and the US before the monsoons. EU-origin shredded scrap is offered at $423-426/t, with bids at $415-416/t, and EU-origin HMS (80:20) prices are at $400-404/t, with bids at $395-398/t. H2 Japan (bulk) offers are at $395-398/t, with workable levels at $392/t, while US-origin HMS (80:20) (bulk) offers are at $405-407/t, with workable levels at $396-398/t. UAE-origin HMS and PNS mix is priced at $425-428/t, and Australia-origin HMS (90:10) is being offered at $415-418/t.
A major steel mill source stated, "No bookings have been made from our side since the Eid vacations as we are primarily sourcing from the domestic market. We currently have sufficient stocks for production."
According to another steel mill source, one of the two gas stations has been shut down for repairs and is expected to resume operations on 14 July, with equipment being repaired in Singapore. Consequently, some rolling mills have either halted production or are operating at 50% capacity. Import activity is slow due to port congestion, which has driven the dollar up. Indicative prices for shredded scrap from Australia are at $430-435/t, while PNS from Malaysia, Australia, and Hong Kong is also priced at $430-435/t. PNS from Brazil is at $410-415/t.
As per market reports, Bangladesh's total ferrous scrap imports rose by 26% to 2.35 mnt in H1 CY'24 as compared to 1.86 mnt in H1 CY'23.
Changes in assessment prices:
- BigMint's assessment of Europe-origin containerised shredded increased by $1/t w-o-w to $425/t, while HMS (80:20) prices stood at $402/t (unchanged w-o-w).
- BigMint's latest weekly assessment shows US-origin HMS (80:20) bulk prices increasing by $1/t t0 $405/t CFR Chattogram.
- BigMint's weekly assessment for Japan-origin H2 bulk price shows an increase of $2/t w-o-w at $396/t CFR Chattogram.
Recent deals
- Around 11000 t of HMS(90:10) from Australia booked at $410/t CFR Chattogram
- Around 2000 t of PNS from the US booked at $445/t CFR Chattogram
- 500 t of HMS bundle from Malaysia at $420/t CFR Chattogram
- Around 2000 t of HMS bundles from Brazil sold at $380/t CFR Chattogram
- Around 5000 t of Shredded from Australia at $426/t CFR Chattogram
- Approximately 2000 t of Shredded from New Zealand booked at $425/t CFR Chattogram
- Around 2000 t of HMS(90:10) from Australia booked at $408/t CFR Chattogram
- Approximately 1000 t of HMS(90:10) from New Zealand at $410/t CFR Chattogram
- Around 3000 t of HMS-PNS mix from UAE at $420-422/t CFR Chattogram
Domestic market: Domestic rebar prices are BDT 87,500-88,600/t exw Dhaka and BDT 93,800-94,200/t exw Chattogram, with billet at BDT 75,500/t and offers at BDT 77,000/t. Scrap ship ex Chattogram yard is priced at BDT 61,200-61,800/t exy.
As per market sources, rebar prices are ranging from BDT 87,000 to 89,000/t, billet prices are at BDT 75,000-76,000/t and ship-breaking scrap plate prices for 20-22 mm thickness are at BDT 75,000/t. Rebar demand is slow due to the monsoons, causing prices to drop by BDT 500/t.
BSRM, the largest construction steel producer, is set to commission a $27 million plant in Mirsarai, Chattogram, by late June or early July. With an annual production capacity of 800,000 t, the new plant aims to boost BSRM's market share from 23% to 34% and meet growing steel demand.
Occupying 20 acres, the plant will start trial production at the end of June and reach full commercial production within a month, creating around 1,000 jobs. This addition will increase BSRM's total production capacity to 2.4 mnt, enhancing its market dominance. It will also produce 150,000 t of steel wire, reducing the need to import 85,000 t annually.
Bangladesh's steel industry produces 7-7.5 mnt of steel annually through 55 rolling mills and over 100 semi-automatic and manual plants, with 60% of steel produced going straight to government projects.
Outlook: Market watchers indicate a firm trend in imported containerised scrap offers from Australia and the UAE amid regular inquiries. Steelmaking operations will be affected during the monsoons with low demand expected for rebar used in construction activities.
