Bangladesh: Imported scrap prices fall by up to $6/t w-o-w as inquiries remain slow
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- LC openings improve but remain infrequent amid bid-offer disparity
- Chattogram port tonnage rises significantly despite slow vessel sales
Bangladesh's imported scrap prices dropped by $5-6/t w-o-w, with bulk scrap inquiries remaining slow except from a few large mills. Small buyers continue to bid well below suppliers' offers, leading to a $1-2/t price decrease for US and Australian scrap. The domestic scrap market rose to BDT 54,000-55,000/t ($444-452/t), up by BDT 1,000-1,500/t ($8-12/t). Steel market volatility persists with fluctuating offers and sales. Domestic billet prices ranged from BDT 73,000-74,000/t ($600-608/t), while rebar prices rose to BDT 88,000-88,500/t ($723-727/t) in Chattogram.
BigMint's weekly assessments
- European-origin containerised shredded was down by $6/t w-o-w at $385/t
- European-origin HMS (80:20) down by $5/t w-o-w to $368/t.
- US-sourced HMS (80:20) bulk prices were down slightly by $1/t w-o-w to $363/t
- Japanese-origin H2 bulk prices stood at $350/t CFR Chattogram,up by $2/t w-o-w.
H2 from Japan was priced at $350-352/t CFR post Kanto tender, where a Bangladesh-based mill secured 15,000 t at $350-355/t CFR.
US offers ranged from $365-370/t, but buyers bid below $360/t. Bangladesh's bulk ferrous scrap imports grew 9% y-o-y in CY'24, reaching 3.55 mnt, up from 3.26 mnt in CY'23, despite a market slowdown.
Current containerised scrap prices are $365/t for HMS, $375/t for shredded, and $390/t for PNS from Australia.
Market scenario
A major Dhaka-based mill source commented, "The market remains largely stable compared to last week's offers, but there are no bids this week. Sentiment is low, with limited activity. Shredded scrap from Australia is available at $380-385/t, while PNS from Singapore is offered at $385-388/t. Bulk H2 is at $350-352/t, and US-origin bulk HMS is priced at $360-365/t. Inquiries are ongoing, but bid-offer disparities persist. A Chattogram-based mill is currently operating at a low key, though they are expected to make some purchases soon."
A major Chattogram-based trader told BigMint, "Opening Letters of Credit (LCs) has slightly improved but remains infrequent. While offers remain firm, bids have dropped by $6-8/t. Buyers in Dhaka are relatively active, but those in Chattogram are quoting prices well below current offer levels."
In the last seven days, scrap deals for Chattogram included: HMS (80:20) from Australia at $360-365/t CFR for 1,000 t, PNS from Hong Kong at $385/t CFR for 1,000 t, LMS bundles from Malaysia/Philippines at $335/t CFR for 500 t, bulk H1-H2 mix from Japan at $352/t CFR for 10,000 t, PNS mixed with HMS (90:10) at $382/t CFR from Dubai and Hong Kong, PNS (H Beams) from Hong Kong at $395/t CFR for 500 t, and PNS from Malaysia at $380/t CFR for 500 t.
Economic slowdown hits shipbreaking market
The Bangladeshi shipbreaking market cooled this week amid economic instability, inflation, and a VAT hike, which dampened steel and ship recycling activity. Bangladesh's VAT and SD hikes on 100 items, including essentials, aim to boost revenue amid declining tax collections and IMF loan conditions. However, these increases have worsened inflation, straining consumers and businesses.
Vessel offers fell near Pakistan's struggling levels as the Taka (BDT) weakened against the US Dollar. Steel plate prices held steady at $529/LDT, offering limited relief.
While Chattogram avoided the empty port scenario seen in Gadani, the impact of Biden's COSCO sanctions on wet units remains uncertain. Despite a VLCC sale, several vessels remain unsold ahead of the Chinese New Year shutdown. Tonnage at Chattogram Port rose to 6,418 LDT, up from 1,969 LDT last week.
Outlook:
According to market sources, the uncertain price trend is expected to persist until Ramadan in March. While buyers in Dhaka remain relatively active, those in Chattogram are quoting prices significantly lower than current offer levels. This trend is likely to continue as Chattogram mills hold ample scrap inventories.
