Bangladesh: Imported scrap prices edge up; trade yet to pick up

Imported scrap prices continue to move up on the back of active Turkish scrap procurement in recent days. However, trade has yet to pick up. Steelmakers are cautious as production activities remained dull. Increased production costs, power outages, and LC opening restrictions remained major issues for the entire steel industry.

A Mediterranean region-based Turkish mill booked a Venezuelan-origin bulk scrap cargo comprising HMS (90:10) at $385/t CFR Turkiye, SteelMint learnt from sources aware of the development. The cargo was booked for prompt shipments.

Containerised scrap offers

• Containerized offers for UK-origin shredded scrap are set at $440-445/t CFR, inching up by $5/t w-o-w.
  
  
• Meanwhile, containerized UK-origin HMS 1&2 (80:20) are at $420-425/t CFR Chittagong, up by $10/t w-o-w
  
  
• Local scrap is currently being traded at BDT 61,000/t ex-works, unchanged w-o-w.
  
  

Bulk scrap offers edge up

The imported bulk scrap market was largely quiet as buyers remained silent due to negative market sentiment. On the other hand, traders and steelmakers are in trouble due to the delay in the LC opening.

• Indicative offers for Japanese H2 are at $400/t CFR levels, moving up over $20/t w-o-w. However, no fresh bids are heard from the buyers' side. Meanwhile, buyers are waiting for clearer market directions ahead of Kanto scrap export tender.
  
  
• Furthermore, US-origin bulk scrap offers are now being quoted at $410/t CFR level, moving up significantly by $30/t w-o-w.
  
  

"Traders are in trouble due to the delay in Lc opening, as they are unable to fulfil old commitments," said a scrap trader.

Bangladesh Bank to launch crisis management cell: The Bangladesh Bank is set to create a crisis management cell to facilitate the opening of letters of credit (LCs) for the import of essential commodities, as per a decision of a meeting at the Commerce Ministry, as per a media report.

The decision has come at a time when businesses, including commodities importers and processors, have complained that they cannot open LCs for import owing to the reluctance of banks on US dollar shortage.

Domestic market subdued

Domestic finished steel market remained subdued owing to liquidity issues domestically. However, mills are under pressure to sell their material at low prices.

SteelMint-assessed domestic rebar prices are at BDT 89,000-90,000 /t ($876-885/t) exw-Chittagong. However, the secondary mills in Dhaka have kept their rebar offers at BDT 85,000/t ($826/t), unchanged w-o-w.