Bangladesh: Bulk scrap cargo booking resumes, LC issues worry steel mills

• One bulk scrap cargo booked apart from Kanto tender booking
• Containerised imported scrap prices drop further following global trend
• Domestic market subdued on currency depreciation

The imported scrap market in Bangladesh witnessed a drop in prices in terms of both container and bulk material. Trade in containers remained subdued as the market resumed this week post-Eid holidays. However, there is one bulk cargo heard to have been booked from Australia/New Zealand apart from Japan’s Kanto tender booking seen last week.

Major mill books bulk ferrous scrap cargo  

In a recent deal concluded, a major mill based in the Chittagong region booked a 30,000-tonne mixed bulk cargo from Australia/New Zealand. The cargo comprised 18,000 t of bonus at $430/t and 12,000 t of HMS 1&2 (80/20) at $420-425/t CFR Chittagong basis.

Furthermore, not many offers from the US were heard. However, indications for US-origin bulk HMS 1&2 (80:20) are heard at $440/t CFR Chittagong levels.

“If sellers cannot sell to Turkiye, Bangladesh buyers will get more bulk cargoes. However, bid levels are comparatively low,” said a bulk scrap trader.

Container imported scrap market remains less active 

The containerised scrap market remained less active in booking fresh slots for the monsoon season. However, buyers have adopted a wait-and-watch approach and bookings are likely to resume for restocking only after a week. Sources revealed that major mills have not booked any containerized material for the last 3-4 months.

• A decent quantity of shredded from the UK/EU have been sold at $505-510/t CFR Chittagong levels in fresh trades.
• Fresh offers of UK-origin shredded are being heard at $480-490/t CFR levels, moving down significantly by $30-35/t levels w-o-w.
• SteelMint’s assessment for UK-origin HMS (80:20) stands at $455/t CFR, down by $20-25/t w-o-w.

“After the power cuts and LC restriction, buyers are not actively booking any fresh slots for scrap purchases,” said a scrap trader.

Due to the LNG shortage — as the government limits imports of LNG — secondary mills have slowed down steel production. Furthermore, the government has planned load shedding for residential and commercial areas as a precaution against LNG shortage, SteelMint understands.

Mills lower rebar offers  

• SteelMint assessment for domestic rebar prices remained unchanged at BDT 82,000/t ($873/t) exw Chittagong levels, down by BDT 1,000/t w-o-w.
• Secondary mills in the Dhaka region are quoting rebar at BDT 78,000/t ($830/t), unchanged w-o-w. 

Outlook

Imported bulk scrap buyers are likely to keep bookings active on restocking. However, finished steel demand is expected to remain on the lower side, owing to the monsoon, power cuts and LC-related issues.