Bangladesh Mills Hold Back Sponge Iron Bookings on Rising Offers

The major steel mills in Bangladesh seem to be in wait & watch mode as there is no fresh bookings for Indian sponge iron exports.

The export demand for Indian sponge iron has weakened with the recent hike in price range. In a week's time, sponge iron export offers increased further by USD 5-10/MT on account of increased prices in Indian domestic market by INR 500-1,000/MT (USD 7-14).

The current export offers to Bangladesh for sponge C-DRI (80 FeM, 100% lumps) reported at near to USD 300/MT, which was last week hovering at USD 290-295/MT CPT Benapole (dry port of India & Bangladesh).

SteelMint learned that the last deals were taking place at the price range of USD 280-285/MT CPT. However, after that major buyers remained away from taking positions on account of constant price rally. On an average about 10,000 MT, deals were reported 7-10 days ago at near to USD 280-285/MT CPT, equivalent to USD 295-300/MT CFR Chittagong, Bangladesh.

It was also cited that the local steel demand in Bangladesh is not up to the mark, which is directly affecting the profit margins of local re-rollers. Thus, on rising raw materials, they are cautious to book material looking at low conversions along with sufficient stock in hand.

Also, imported scrap offers to Bangladesh remained strong and marked at around USD 322-325/MT, CFR Chittagong, for shredded grade. In the beginning of last week, a major steelmaker from Chittagong had booked a USA origin bulk cargo comprising entirely of shredded scrap at USD 325/MT, CFR Chittagong for Feb'20 shipment.