Bangladesh: Mills remain active in bulk imported scrap bookings amid lower offers

Bangladesh-based steel mills continued to secure imported bulk scrap cargoes as offers fell further. In recent deals, concluded earlier in the week, Bangladeshi mills booked two US-origin bulk cargoes which comprised a mix of HMS 1&2 (80:20) — booked at $490/t CFR — and shredded scrap, which was sold at $495/t CFR Chittagong. Prices corrected downwards by around $20/t w-o-w.

In the absence of Japanese offers, Bangladeshi mills took advantage of low offers from the EU and US.

In contrast, no firm offers were quoted for Japanese H2 material as suppliers are focusing on the domestic market. Meanwhile, Japan’s monthly Kanto Tetsugen ferrous scrap export tender has been scheduled for 9 June, 2022, sources informed SteelMint. Lower bids from participants resulted in the tender remaining inconclusive last month. Furthermore, the sequential cuts in Japan’s Tokyo Steel’s scrap purchase prices may pull export offers down.

Containerised imported scrap prices firm

The containerized imported scrap market remained volatile throughout the week. Buyers are hesitant to book fresh material due to unstable prices. Hence, most secondary mills opted to wait for further price clarity.

• Fresh offers for UK/EU-origin shredded are at $550/t CFR level, unchanged w-o-w whereas bid prices are at $530-540/t CFR basis.
• UK-origin HMS 1&2 (80:20) are at $510/t CFR basis, down by $10/t w-o-w.
  

Market highlights

• BDT hits new record low: The local currency depreciated further against the dollar due to a high outflow of foreign exchange. Currently, the taka is being traded at 92.66 to the dollar.
• Rebar offers unchanged w-o-w: Domestic rebar prices remained mostly unchanged w-o-w due to limited demand from end-users. As per SteelMint’s assessment, the major mills’ rebar (10-16mm) price assessment stood at BDT 85,000-87,000/t($954-977/t) exw Chittagong, including taxes.
• Total scrap imports at 0.33 mn t in May: Bangladesh’s total scrap imports stood at 0.33 mn t in May 2022. Imports of bulk fell to 0.21 million tonnes (mnt) compared to 0.39 mnt in April, according to the vessel line-up data maintained with SteelMint.

Outlook: Market participants are waiting for the upcoming fiscal budget which is scheduled to be announced on 9 June. They expect some duty changes before making the next round of bookings.