Bangladesh based Buyers Actively Looking for Bulk Scrap Cargoes

Bangladesh based steel makers are actively looking to source bulk scrap cargoes owing to low inventory levels. According to market participants, around 4-5 bulk cargoes have been sold in June and buyers are looking for more cargoes.

“Inquires for bulk cargoes are quite high from Bangladesh. At the same time there are limited bulk offers in the market as Turkey has actively bought cargoes in last few weeks. Current offers for shredded scrap (bulk) to Bangladesh would be around USD 305-307/MT CFR Chittagong.”said one of the large supplier based in Dubai.

As per sources recently, a bulk import vessel carrying HMS 1&2 from US has been booked last week at around USD 295-300/MT, CFR Bangladesh.

Recently Bangladesh government in its federal budget has changed the duty structure on imports of scrap, sponge iron, pig iron and ingots. According to which imports of scrap is a viable option as compared to sponge iron and billets. Bangladesh based buyers are expected to increase their scrap imports in coming time.

“Scrap buying was low before budget as steel mills were waiting for government’s proposed duty structure. Steel mills are back in the market and demand for imported scrap has increased. said a local broker based in Chittagong.

He also mentioned that new duty structure will make steel rolling expensive using ship cutting plates, which is one of the major source of raw material.

According to data maintained by SteelMint, Bangladesh imported 0.38 MnT ferrous scrap during Jan-Apr’17 against 0.19 MnT in the same period last year.

Bangladesh has an installed steel capacity of around 3.5 MnT, which is expected to increase to 5 MnT in coming years.

Scrap Prices

Source: SteelMint Research