Bangladesh: Imported scrap inquiries improve on limited inventory at steel mills

Bangladeshi steel mills have raised their bids for bulk scrap vessels following the easing up of LC opening issues along with limited scrap inventory at mills, SteelMint learnt from sources.

“The imported scrap market has improved slightly with better buying inquiries. Negotiations are going on,” said a scrap trader.

A few global suppliers are willing to conclude deals without LCs, considering previous transactions, whereas some suppliers cancelled their contracts amid partial or delayed LC facilities.

Major steel producers like GPH, BSRM and AKS had halted operations earlier amid acute shortage of raw materials, and are now likely to resume upon arrival of scrap cargoes.

A major mill booked 15,000 t Japanese bulk cargo at $470/t CFR last week from Japan’s Kanto scrap export tender.

• Fresh indicative offers for bulk Japanese H2 are at $480-485/t CFR, up by $10-15/t w-o-w.
• On the other hand, offers for US-origin bulk HMS material are at $490/t CFR Chittagong. However, fresh deals are yet to conclude.

Containerised trade improves

The market witnessed better transactions and a few container deals have been reported from last week. A few steel mills are exploring other sourcing routes apart from the regular ones like the UK amid higher offers. Market chatter is that around 10–15 small mills are likely to shut shop this month due to liquidity issues.

• A major mill has booked around 40,000 t of mix scrap (PNS at $505-510/t CFR and HMS at $475-480/t CFR) in containers from Malaysia, Singapore and Brazil last week.
• Around 5,000 t of HMS has been sold for $468-470/t CFR over the last couple of days.
• US-origin 1,000 t HMS (90:10) material has been sold at $475/t CFR.

Domestic rebar prices rise

With limited availability of scrap at mills, domestic rebar prices edged up. Major mills like BSRM are now offering rebar at BDT 100,000/t levels, but transactions may happen at lower levels. This is the highest price recorded since 2008, as per sources.

SteelMint’s assessment for domestic rebar stands at BDT 98,000-100,000/t ($928-947/t) exw-Chittagong, up BDT 2,000/t w-o-w. Mills in Dhaka have followed suit, increasing their rebar offers by BDT 2,000/t to BDT 95,000-96,000/t ($900-910/t).

Outlook: Considering the approaching Ramadan month, market activities may slow down, but offers are expected to remain high.