Bangladesh: Imported scrap buyers maintain silence, prices remain stable

Bangladesh's imported scrap market continued to maintain silence, with no active deals concluded throughout the week. Imported scrap offers remained mostly stable w-o-w as limited trade activities witnessed in the week.

• Fresh offers for US-origin bulk HMS are heard at $460/t, and CFR Chittagong is up by over $10/t w-o-w.
  
  
• Bulk Japanese H2 indicative levels were at $455/t, unchanged w-o-w.
  
  

Steel producers and traders are waiting to get new Letters of Credit (LCs) for previously booked raw material, which is already in the pipeline. "The central bank is not allowing local banks to purchase currency from the global bank," said a reliable source.

Fresh containerised offers for UK-origin shredded scrap are at $470/t CFR, unchanged for the third straight week.

Market sentiments remained negative, however couple of bulk cargoes were booked last month by major mills, in anticipation of market support in near-term.

IMF approves $4.7 billion support: With the approval of a $4.7 billion loan by the International Monetary Fund (IMF) for Bangladesh, much of the concern regarding its economy can be abated it seems.

The authorities took the necessary steps to navigate these challenges, including tightening of the monetary stance, allowing for a more flexible exchange rate, imposing temporary restrictions on non-essential and energy-related imports, and adopting measures to reduce electricity demand.

"It will of course help a bit to come out from a little tight situation. But if the global situation does not improve, everybody has to suffer," said a Bangladesh-based steel producer.

Mills under pressure

Mills are generally cautious due to limited raw material availability in the domestic market, increased production costs, and a lack of finished steel demand from domestic end-users.

"Domestic prices continued to rise due to the currency crisis," a steel producer in Dhaka said.

Despite limited trading activities, mills kept their finished steel prices high.

SteelMint assessed domestic rebar prices at BDT 93,000-94,000/t ($896-905/t) exw-Chattogram. Dhaka-based mills have kept their rebar offers unchanged for the seventh consecutive week at BDT 87,000-89,000/t ($838-857/t), unchanged w-o-w.

Further, local ship-breaking scrap prices moved up by BDT 3,000/t w-o-w to BDT 68,000-69,000/t ($/t) ex-yard Chittagong.