Indian Sponge Iron Export Prices to Bangladesh Remain Stable in Fresh Deals
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Sponge iron export prices to Bangladesh remained unchanged in the fresh deals that were concluded for over 3,000 MT quantity.
Indian sponge iron export market has regained momentum this week. According to market sources, deals of more than 3,000 MT sponge C-DRI (80 FeM, 100% lumps) were concluded to Bangladesh in the last couple of days at an average price of USD 286-288/MT CPT Benapole (dry port of India & Bangladesh). This is equivalent to USD 300-305/MT CFR Chittagong, Bangladesh.
Hence, with these fresh deals, the prices were assessed to be same as against last week's report of USD 285-290/MT CPT Benapole,
Participants reported limited buying due to poor demand of local finished steel in Bangladesh. In addition, volatile scrap prices at global market is another major factor which has delayed future bookings for raw materials by major mills.
Meanwhile, imported scrap trades to Bangladesh were recorded slow and currently, the market is witnessing little to no interest from the buyer's side on account of less viability of imported scrap due to high global offers amid falling domestic steel prices. Most of the US and European suppliers are not offering to Bangladesh because of low bids and good sales in other markets.
As a result, scrap export offers to Bangladesh rallied by USD 15-20/MT W-o-W and stood at around USD 320/MT, CFR Chittagong, for containerized Shredded scrap from UK/Europe.
For Indian sponge iron exports in CY19 (Jan-Dec), Bangladesh stood as the major buyer with 50-55% contribution. Out of the total quantity, Bangladesh imported about 457,862 MT (52.5%), followed by Bhutan at 175,467 MT (20.1%) & Nepal at 147,500 MT (16.9%) during Jan-Dec'19.
The average steel melting capacity in Bangladesh is about 7 MnT pa, in which major mills are based in Chittagong, while mid scale mills are located in Dhaka area. Presently, the mills are operating at lower capacity utilization by 20-30% against the installed capacity on account of weak demand.
