Bangladesh: Imported Scrap Offers Inch Up; Buying Interest Improves

As per recent conversations with market participants, SteelMint learned that imported scrap offers to Bangladesh Inch up amid hike in global scrap prices. This week inquiries for containerized scrap gained movement and importers are now likely to resume scrap buying activities soon.

Offers for imported Shredded 211 scrap in containers assessed around USD 380-385/MT, CFR Bangladesh while few offers for HMS 1&2 in containers from West Africa and Brazil heard around USD 370-375/MT, CFR Chittagong. Thus, price assessment has moved up by USD 5-10/MT on W-o-W basis.

Offers for P&S scrap heard around USD 385/MT, CFR from Brazil, Australia and New Zealand.

“Local ship breaking scrap prices have gone up in last 2-3 days in Bangladesh over which buyers have turned towards imported scrap. Though most of the buyers are still waiting and very few deals have concluded in the market this week, importers may book good volumes in coming days”- shared a source.

Ship breaking prices also moved up by USD 5-10/MT on W-o-W basis amid steady sentiments in Bangladesh. Last week prices assessed at USD 430/LDT for general dry bulk cargo, at USD 440/LDT for tanker cargo and at USD 450/LDT for containers respectively on CNF Bangladesh basis. However, no sale concluded this week over the stronger competitor like India and Pakistan markets.

Imported scrap demand in Bangladesh to rise in coming years –

Bangladesh has been witnessing successive increasing scrap imports since last 3 years. According to market participants, scrap imports to Bangladesh are likely to shoot-up further significantly over the next two years. Bangladesh imported approximately 0.71 MnT, 1.70 MnT and 2.17 MnT scrap in 2015, 2016 and 2017 respectively which is likely to cross 3 MnT by 2020.

BSRM estimates its scrap demand to be around 1.6 MnT by end of 2019. Whereas GPH Ispat has estimated its scrap demand to be close to 1 MnT by 2020. Notably, most of Bangladesh’s major steel producers primarily consume imported scrap since local obsolete scrap generation is marginal and ship breaking scrap is directly used by re-rollers.