gloal ferrous srap

MONTHLY REVIEW MARCH 2021

Page No. Content

01

02

India's scrap availability to get a boost as govt introduces new vehi-

cle scrapping policy

South Asian Market Overview (India, Pakistan, Bangladesh)

Imported & domestic scrap prices

Metallics prices (DRI, pig iron) price trends

03

Semi-finished steel (billet) prices

India's domestic steel scrap index

04 Japan, South Korea and South East Asia (Vietnam & Indonesia)

Japan domestic scrap & export market overview

Japanese monthly scrap export tender results

SE Asia imported scrap price trends (Vietnam & Indonesia)

05 China and Taiwan

China: Domestic scrap & billet price trends

Taiwan: Domestic & imported scrap prices

Rebar price trends in Taiwan

06 Turkey, USA and Europe

Imported scrap price movements & deep-sea cargo deals

Turkey country-wise scrap imports

07 Ship-breaking (India, Bangladesh and Pakistan)

Ship breaking prices

08

Vessel import data

Imported scrap bookings

GLOBAL

FERROUS SCRAP

India's scrap availability to get a boost as govt introduces new vehicle scrapping policy

Union Minister Nitin Gadkari has announced a voluntary vehicle scrappage policy in the Lok Sabha on 18 Mar’21 while high-lighting the fact that the measure is in harmony with new technology that promises to usher in a win-win situation for all.

The new policy is expected to boost the manufacturing and services sectors with the aim of generating employment.

Policy objective The central objective of the policy is to reduce the presence of old and polluting vehicles on the roads and to achieve 25-30% reduction in vehicular air pollutants in order to fulfill India's climate commitments, improve road and vehicular safety, achieve better fuel efficiency and formalise the vehicle scrapping sphere. Furthermore, the policy aims to boost availability of low-cost raw materials for the automotive and electronics industries.

Vehicle scrapping criteria The criteria for a vehicle to be scrapped are primarily based on the fitness of vehicles tested at Automated Fitness Centres in case of commercial vehicles and non-renewal of registration for private vehicles. The criterion has been adapted as per the international best practices and standards followed in countries such as Germany, the UK, USA and Japan.

The fitness test and non-renewal of registration are for vehicles that fail to get a fitness certificate. These include...

Commercial Vehicles after 15 years

Private Vehicles after 20 years

Government Vehicles after 15 years A vehicle failing the fitness test or failing to get a registration renewal may be declared as an 'End of Life Vehicle'.

Proposed incentives Incentives to owners of old vehicles for scrapping old and unfit vehicles through registered scrapping centers include:

Road tax rebate (advisory has been issued to all states)i.e. up to 25% rebate in road tax for personal vehicleand 15% for commercial vehicle

5% rebate on the purchase of new vehicles against a scrapping certificate

Waiver of registration fees for a purchased vehicle

The Ministry of Road Transport and Highways will promote the setting up of Registered Vehicle Scrapping Facility (RVSF) across the country. Some of the identified places include Alang in Gujarat, where developing a highly specialized center for scrapping is in the works. Similarly, the government shall promote setting up of Automated Fitness Centres on a PPP model by the state governments, private sector, and automobile companies, etc.

Timeline

The government in the next few weeks is expected to publish

draft notifications, which shall be in the public domain for a peri-

od of 30 days to solicit comments and views of stakeholders.

Apart from attracting additional investments of around INR

10,000 crore and 35,000 crore job opportunities, the policy is

expected to give a big boost to India's domestic ferrous scrap

availability and, in turn, help in achieving India's steel capacity

target of 300 mn t.

India's ferrous scrap demand is expected to increase significantly

in the coming years from present levels of around 30-32 mn t

per year.

Assessment Mar’21

Avg

Lowest Price in

Mar'21

Highest Price in

Mar’21

Feb’21

Avg

% Change

(m-o-m)

Mar’20

Avg

India

India imported scrap ($/t)

Shredded, CNF Nhava Sheva 450 435 (29th Mar) 470 (1st Mar) 430 5% 290

HMS 1&2 (80:20), ex UK, CNF Nhava 420 410 (29th Mar) 430 (8th Mar) 390 8% 280

India Domestic scrap (₹/t)

HMS (80:20) EXW Mandi 30,470 29,200 (8th Mar) 32,400 (31st Mar) 27,950 9% 21,500

HMS (80:20) EXW Mumbai 29,670 29,300 (8th Mar) 31,200 (31st Mar) 27,590 8% 23,040

Alang Ship yard melting scrap 30,940 30,000 (18th Mar 32,000 (31st Mar) 28,380 9% 23,150

Indian Metallics (₹/t)

C-DRI exw Raipur 28,300 27,800 (8th Mar) 29,800 (31st Mar) 25,340 12% 18,680

P-DRI exw Raipur 27,340 27,000 (25th Mar) 28,800 (31st Mar) 24,420 12% 17,760

Pig Iron (Steel Grd) Exw Durgapur 35,560 35,400 (25th Mar) 36,800 (31st Mar) 32,990 8% 25,920

Indian Domestic Billet (₹/t)

Billet (DAP Mumbai) 40,800 40,000 (9th Mar) 42,400 (31st Mar) 37,880 8% 29,990

Billet (DAP Chennai) 41,240 40,500 (9th Mar) 43,500 (31st Mar) 37,340 10% 30,470

Bangladesh

Bangladesh imported scrap ($/t)

Shredded, CNF Chittagong 470 460 (22nd Mar) 485 (1st Mar) 445 6% 290

HMS 1&2 (80:20), CNF Chittagong 455 445 (29th Mar) 460 (1st Mar) 425 7% 260

Japanese H2 Bulk, CNF Chittagong 465 455 (22nd Mar) 475 (1st Mar) 425 9% __-

Bangladesh Domestic Scrap (৳/t)

Chittagong Ship yard melting scrap 44,250 43,500 (10th Mar) 45,000 (3rd Mar) 40,380 10% -

Bangladesh imported DRI ($/t)

DRI ex India, CNF Chittagong 420 405 (8th Mar) 445 (29th Mar) 385 9% 285

Pakistan

Pakistan imported scrap ($/t)

Shredded 211, CNF Qasim 445 430 (15th Mar) 470 (1st Mar) 430 3% 275

Pakistan Domestic Scrap (PKR/t)

Local Scrap Eq. to Shred, Exw Punjab 88,840 88,500 (2nd Mar) 89,200 (31st Mar) 79,870 11% -

Pakistan Domestic prices (PKR/t)

CC Billet, Grade 60 Exw Punjab 112,100 110,500(23rd Mar) 112,000 (31st Mar) 110,150 2% -

CC Rebar, Grade 60 Exw Punjab 129,600 129,000(22ndMar) 130,000 (1st Mar) 127,000 2% -

South Asia (India, Bangladesh and Pakistan)

India: Imported scrap market in India remained qui-

et while limited trades were reported. Market remained uncer-

tain due to freight rates, Suez canal blockage, Holi festival, and

financial year-closing were remained the major factors that

kept buyers away from the market.

Buyers continued to remain on side-lines and preferred to go

with domestic substitutes of domestic scrap & sponge iron,

due to disparity between bids and offers.

Pakistan: Pakistani sources were hopeful that trade activities

will gain momentum ahead of Ramadan festival which will start

mid of April.

Imported scrap offers continued to dip in Pakistan earlier in the

month. The market was under pressure due to high seas sales

& distressed cargo sales.

Bangladesh: Imported scrap trades in Bangladesh remained

active with bookings concluded both in containers as well as

bulk segments. Apart from major mills in Bangladesh like BSRM,

Abul Khair etc, mills in Dhaka were aggressively booking import-

ed scrap.

Bulk offers for Japanese H2 have dropped significantly by $8-10,

immediately after Japan's Kanto scrap export tender conclud-

ed .

India's domestic steel scrap index

Steel melting scrap movement was halted amid strike was going on by Iron Scrap Traders Welfare Association in Punjab

market. The strike was come into effect from 17th Mar'21, following which trade participants turned inactive and no firm

offers were seen in the market today.

Assessment Mar’21

Avg

Lowest Price in

Mar’21

Highest Price in

Mar’21

Feb’21 Avg % Change

(m-o-m)

Mar’20

Avg

Japan

Tokyo Steel

Tahara Plant (JPY/t, DAP) 41,750 41,000 (26th Mar) 42,500 (5th Mar) 39,210 6% 20,370

Utsunomiya Plant (JPY/t, DAP) 41,310 40,000 (26th Mar) 42,500 (5th Mar) 37,210 11% 19,370

Kanto Tetsugan Tender (JPY/t, FoB) 42,970 - - 42,920 0% 22,650

South Korea

Bulk Japanese H2 Offers (JPY/t FoB 43,000 41,000 (26th Mar) 44,000 (12th Mar) 40,070 7% 22,160

Vietnam

Bulk Japanese H2 (CFR $/t) 445 430 (22nd Mar) 470 (8th Mar) 410 9% -

Bulk USA HMS 1&2 (80:20) (CFR $/t) 455 435 (29th Mar) 475 (8th Mar) 420 8% -

Indonesia

P&S Scrap 20 ft container (CFR $/t) 445 440 (22nd Mar) 455 (15th Mar) 430 3% -

Busheling scrap (CFR $/t) 455 455 (1st Mar) 460 (15th Mar) 440 1% -

apan, South Korea and South East Asia

Bids in monthly Kanto scrap export tender rose by

$34 m-o-m: A total of around 15,400 t of Japanese

H2 scrap was awarded at an average price of JPY

42,976/t ($395) FAS basis in Japan's monthly Kan-

to Tetsugen ferrous scrap export tender, rising by

JPY 3,705/t ($34) m-o-m.

South Korean mill continued to lower their bid

price for Japanese bulk scrap cargoes. Major steel

mill has booked 35,000 t of Russian A3 scrap and

was concluded at $425/t CFR basis for May'21 de-

livery.

Japan’s Tokyo Steel announces seven scrap pur-

chase price cuts in Mar'21: Japan's leading EAF mill

- Tokyo Steel had lowered the bids for scrap pur-

chase seven times in Mar’21.

Prices at its Kanto works dropped to one-month

low level towards end-Mar’21. Decline in scrap ex-

port offers resulted in lower domestic scrap prices

as well.

Indonesian scrap buyers cautious: Post CNY

holidays imported scrap offers to Indonesia con-

tinued to rally, buyers turned cautious and post-

poned their bookings. Early in the

month Indonesian scrap market was quiet, how-

ever, offers have jumped sharply.

After continuous silence in imported scrap mar-

ket, few buying activities were wit-

nessed towards the closing of the month as

prices have declined significantly.

Vietnamese buyer preferred USA car-

goes: Imported scrap trades pick from US, on lim-

ited offers were reported from Ja-

pan. Vietnamese mills have booked three bulk

cargoes throughout the month, containing 30,000

-35,000 t each for HMS 1&2 (80:20) grade.

Japanese suppliers were in a dilemma to quote

fresh offers due to the sharp hike in freight rates

in since the beginning of the month and tighter

vessel availability.

Source: SteelMint Research

China & Taiwan

Assessment Mar'21

Avg

Lowest Price in

Mar’21

Highest Price in

Mar’21

Feb’21 Avg % Change (

m-o-m)

Mar’20 Avg

China

Shagang 6-10 mm price DAP Jiangsu 3,390 3,390 (2nd Mar) 3,390 (2nd Mar) 3,290 3% 2,540

Billet Exw Tangshan (RMB/t) 4,460 4,270 (2nd Mar) 4,800 (31st Mar) 4,030 11% -

Taiwan

Domestic (HMS 80:20) (TWD/t) 10,480 10,000 (31st Mar) 11,000 (10th Mar) 9,670 8% 6,730

Domestic Rebar (13 mm) (TWD/t) 19,280 18,800 (24th Mar) 19,700 (7th Mar) 18,570 4% 14,960

USA HMS 1&2 (80:20) ($/t) 415 395 (31st Mar) 435 (10th Mar) 385 8% 230

Japanese H2 ($/t) 430 410 (31st Mar) 450 (10th Mar) 390 10% 240

Taiwan imported scrap prices: The spread be-

tween international and local scrap prices was an-

other factor that kept buyers away from the mar-

ket.

The price of US-sourced HMS 1&2 80:20 scrap to

Taiwan dropped by $82/t over the past three

weeks. The price for Japan-origin H2 scrap had

plunged by $100/t compared with the recent high

seen at the start of this year.

Taiwan domestic prices: Local scrap suppliers in

Taiwan have slowed their pace of delivery after

noting the stronger global scrap market.

The uptick in domestic rebar and scrap prices was

the firm support both have gained from higher

raw material prices including iron ore and scrap.

The revival in demand from the end-users as

most construction sites in Taiwan have resumed

normal operations post holidays.

Chinese domestic billet prices rise: The billet

prices in the Tangshan market (northeast Chi-

na) witnessed a further rise. The billet transac-

tions were moderate, while finished steel

posed an upward trend.

Prices were seen hovering at 12.5 year high

levels due to imposed production restrictions

on environmental concerns in Tangshan.

China's Shagang Steel announced single price

hike in scrap purchase: China's largest EAF

steelmaker- Shagang Steel had raised scrap pur-

chase price on 2nd Mar’21 by RMB 100/t ($15)

for all grades. The price for HMS (6-10 mm)

stands at RMB 3,390/t ($523), inclusive of 13%

VAT, delivered to headquarters. Global scrap

price rally and tighter domestic supplies had

resulted in lifting of bid price.


Turkey, USA & Europe

Assessment Mar'21

Avg

Lowest Price in

Mar’21

Highest Price in

Mar’21

Feb’21 Avg % change

(m-o-m)

Mar’20

Avg

Turkey

Bulk USA HMS, CNF Turkey ($/t) 440 425 (22nd Mar) 455 (1st Mar) 415 6% 250

Billet CNF Iskenderun ($/t) 595 580 (22nd Mar) 605 (8th Mar) 565 5% 385

Turkey country-wise ferrous scrap imports (in mn t)

Feb’21 Jan’21 Dec’20 Feb’20 Mar’20-Feb’21

Total Turkey Imports 2 1.93 2.23 1.78 22.93

USA 0.28 0.19 0.38 0.39 4.12

Netherlands 0.43 0.21 0.40 0.29 3.29

Russia 0.14 0.21 0.19 0.13 2.68

UK 0.04 0.38 0.18 0.22 2.38

Others 1.11 0.94 1.08 0.74 10.46

Turkey statistics: Turkey’s ferrous scrap imports witnessed a slight rise by 4% to 2 mn t in Feb'21, as per data recorded with SteelMint. Turkish scrap imports rose y-o-y in the second month of 2021 and recorded a 12% yearly increase. Netherlands stood the top exporter of scrap to Turkey at 0.43 mn t in Feb'21 regis-tering a two-fold increase m-o-m.

Turkey: Imported scrap prices bottomed-out at

$418/t CFR levels by the end of Mar'21, as

per SteelMint’s assessment. In addition to it a con-

tinuous hike in freight rates left market insiders

confused and few buyers postponed their book-

ings, which resulted in market turning silent.

The national currency of Turkey- Lira crashed to

8.3 against $ after the management reorganized in

the central bank just four months after the previ-

ous reboot in Nov'20.


Ship Breaking

Assessment Mar'21

Avg

Lowest Price in

Mar'21

Lowest Price in

Mar'21

Feb’21 Avg % Change

(m-o-m)

Mar’20

Avg

India

Tanker ($/LDT) 450 430 (1st Mar) 460 (29th Mar) 425 6% 365

Container ($/LDT) 460 440 (1st Mar) 470 (29th Mar) 435 6% 385

Pakistan



Bangladesh



Ship Breaking country wise import

India Pakistan Bangladesh

Mar'20 76,559 2,484 131,030

Apr'20 - 1,284 -

May'20 78,003 - 73,120

Jun'20 243,809 102,448 312,856

Jul'20 339,707 87,254 190,082

Aug'20 167,715 67,495 73,223

Sep'20 75,217 205,189 28,876

Oct'20 151,267 164,554 199,055

Nov’20 150,934 121,796 57,241

Dec’20 173,485 157,140 193,317

Jan’21 222,772 75,434 209,587

Feb’21 91,221 22,192 352,302


Ship Breaking: Gadani mar-

ket has improved continuously in prices due to major

ups & downs in the local steel prices amid the decision

by government to not to increase the electricity tariff

(which affects cutting costs).

Alang market is still the best recycling destination as

fundamentals remained steady.

The Bangladeshi market remained a way behind their

sub-continent competitors and it was unsurprising to

see lower sales for another week, as end-buyers have

missed out on some favored units, with Pakistan roar-

ing back.

Imported scrap bookings in Mar’21

NA=Not Available, The deal tables includes only those deals which are recorded by SteelMint

Ms. Rashi Shejwalkar (Research Associate) Email: [email protected]

Disclaimer

SteelMint has taken due care and caution in compilation of content. Information is just for reference not intended for trading purpose or to address your particular requirement. The content includes facts, views, and opinions are of individuals and not that of the SteelMint management. We and our content licensors do not guarantee or warrant the accuracy, completeness or timeliness of, or otherwise endorse these views, and opinions. SteelMint and its affiliates, or their employees, directors or agents shall not be liable or responsible for any loss or costs or any action whatsoever arising out of use or relying on the spot prices disseminated.

CONTRIBUTORS

Ms. Reena Nishad (Sr. Research Associate) Email: [email protected]

The below table highlights the bulk scrap bookings recorded by SteelMint, which were booked in Mar’21 by Turkey,

and Bangladesh. Deals indicated under Pakistan and India are those of containerized scrap bookings.

Turkey

S.no Date Origin Grade Quantity in (t) Avg Price in ($/t),

CNF

1 4th Mar'21 USA HMS (80:20)+

shredded+ mix NA 466

2 4th Mar'21 USA 32,000 463

3 5th Mar'21 USA HMS(80:20) +

shredded 473

4 6th Mar'21 Baltic HMS (80:20)

+Bonus 35,000 465

5 9th Mar'21 USA Shredded+ Bonus 30,000 467

6 9th Mar'21 USA HMS (80:20)+

shredded+ mix NA 458

7 12th Mar'21 Baltic HMS (80:20)

+Bonus 30,000 442

8 27th Mar'21 USA 40,000 420

Bangladesh

1 8th Mar'21 Japan Shindhachi 20,000 NA

2 19th Mar'21 USA HMS (80:20)+

shredded 30,000-35,000 456

3 19th Mar'21 USA HMS (80:20)+

shredded 30,000-35,000 458

Pakistan

1 1st Mar'21 UK/EU Shredded 5,000 464

2 6th Mar'21 UK/EU Shredded 5,000 458

3 13th Mar'21 UK/EU Shredded 4,000 430

4 14th Mar'21 UK/EU Shredded NA 436

5 22nd Mar'21 UK/EU Shredded 1,000 440

India

1 5th Mar'21 Dubai HMS1 4,000 420

2 13th Mar'21 UK/Europe Shredded 3,000 438

3 19th Mar'21 Dubai HMS (80:20) 3,000 388

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