Global scrap suppliers have decreased their offers to Bangladesh this week, though end-users in the country have been very reluctant to accept new prices amid still low demand. Besides, Bangladeshi scrap customers reported difficulties in opening letters of credit (LCs) amid the recent ruling of the central bank stipulating deposits of at least 25 percent of total import payments when opening LCs.
Accordingly, in the containerized scrap segment, most offers have decreased over the past week. Offers for ex-UK shredded scrap have been reported at $655-660/mt CFR, down by $15-20/mt over the past week, while customers’ bids have already been voiced at $630/mt CFR. Ex-US HMS I/II 80:20 scrap has been offered at $620-625/mt CFR, while offers for ex-UK HMS I/II 80:20 have been voiced at $625-630/mt CFR, with a deal signed at $628/mt CFR this week. Meanwhile, offers for ex-South Africa HMS grade material have been heard at $625-630/mt CFR, down by $5-10/mt over the past week.
“We heard that several deals for containerized scrap have been cancelled by buyers in Bangladesh amid problems with opening LCs, but some sellers believe that the price drop also affected their decision to cancel the contracts,” a market insider told SteelOrbis.
Meanwhile, at the beginning of the week, new ex-US scrap bulk offers decreased to $640/mt CFR, down by $10-20/mt week on week, however, by the end of the week, market insiders reported new offers at $625/mt CFR Chittagong. Even despite the significant discounts provided by sellers, no deals have been reported so far.
“The business activity is likely to remain muted next week due to Ramadan. We expect demand to recover in May,” a Bangladesh-based trader stated.