We wish all our readers, colleagues and industry friends, a Merry Christmas, and a Happy New Year 2021.
Though the holiday season this year will be unlike any other as family gatherings are being replaced by social distancing due to the fear of a new strain of coronavirus, let us end this challenging year by finding new opportunities in the new normal. Our Marine community has played its role with utmost sincerity by keeping the global supply chain intact at all times,and we have a huge responsibility to fulfil in the global supply of vaccines to fight against this pandemic. We hope this adversity brings out the best in us and we serve the humanity to our highest potential.
China’s Ministry of Finance released new import and export tax rates for 2021 this Wednesday. Scrap imports will be charged according to the most favored nation (MFN) rate after ferrous scrap was removed from import restrictions. China’s new MFN rates on most kinds of scrap will be cut from 2%to 0% for 2021. This applies to HS codes 720421, 720429, 720449 and 720450.Imports under HS codes 720410, 720430 and 720441 will continue to be charged a 2% MFN duty.
An increase in Chinese steel scrap imports will also have a knock-on effect across the ferrous chain into the iron ore market.
The EU-UK trade deal will soften the economic edges of Brexit, but trade between the two sides will still be hit by a huge amount of new paperwork and border checks following Mr Johnson’s decision to take Britain out of the single market and customs union. COVID-19 and the end of the UK’s transition period might create considerable disruption at ports on 1st January 2021.
The U.N.’s Human Rights Agency is investigating human rights abuses associated with the global shipping industry and exposure to toxic chemicals without prior consent. The main focus of inquiry is on VLSFO (Very Low Sulphur Fuel Oil) due to its highly toxic content.
The End buyers from India are bidding competitively for available tonnage as the domestic steel market is soaring high. They are giving lucrative offers for HKC compliant Recycling too, placing India as one of the favored destinations for Green Ship Recycling.
The price of HMS has maintained its increasing trend this week and the steel market prospects seem to be quite positive for upcoming quarter with increased demand from Auto sector, Infrastructure and Construction activities.
Indian Stainless Steel Development Association (ISSDA)has urged the government to remove import duty on ferro-nickel and stainless-steel scrap which is currently taxed at 2.5%. ISSDA President said, "Stainless steel industry is ready to contribute to the 'Atmanirbhar Bharat' vision. This is the optimum time for the government to stop considering essential raw materials as a source of revenue and provide stimulus to domestic manufacturing by exempting duties on importing critical raw materials."
Ministry of Ports, Shipping and Waterways is creating Product Specific Warehouses/Silos at various Ports such as Cement Silos, Liquid Tanks, Chemicals Tanks, Cold/Refrigerated Storage, Electronics Product Storage, Pharmaceutical Storage, Auto Spares Parts & Components Storage, or any other suggested product to reduce storage losses, minimize logistic costs, and facilitate the distribution of cargo in the hinterland.
India has suspended flights from the UK and few states have imposed mandatory quarantine for flights coming from Europe and Middle East until the end of the year over fears of anew strain of the coronavirus. Night curfews have been imposed in many major cities of India to curb the spread of COVID-19 due to Christmas and New Year celebrations.
The offering price from end buyers has seen some correction this week which has brought all the three major recycling markets i.e.,India, Pakistan, and Bangladesh at par. The prices still remain on the higher bandwidths of $400 - $430/MT and are expected to remain over the $400 mark for sometime.
The imported scrap prices are touching new highs week on week. Along with the prevailing circumstances, two factors which have contributed on the rise this week are:
i) The closure of European yards for the winter holidays.
ii) Reduced supply from Japanese market due to competitive offers being given to them by other Southeast Asian countries.
Imported scrap offers in containers to Bangladesh have soared around $100 in the last one month.
Japanese H2 is now being offered at $485/MT level, up by $35 compared to last week’s offers of $450/MT CFR Chittagong basis.
Meanwhile, US origin suppliers have quoted bulk HMS at$500/MT CFR level, moving up significantly by $35 this week.
The mills in Bangladesh are highly dependent on Imported scrap and meet comparatively lesser part of their demand from Domestic market.
Bangladesh has logged 20 deaths from coronavirus in the past 24 hours taking the overall tally to 7,398. To deal with the rising number of cases, the Bangladesh Government has introduced telemedicine services comprising 100 physicians, for providing emergency healthcare service round-the-clock in the country. More than 23,242,908 people received healthcare services from hotline mobile numbers and health web portals. To receive information and treatment facilities on COVID-19, the contact hotline and mobile numbers are 16263; 333 and 10655.
The prices of raw materials particularly HMS has shot up this week and the End Buyers are confident to grab sufficient tonnage to meet the market appetite.
Due to extreme shortage and sharp increase in cost of raw materials, a revision of Steel ex-factory prices has been necessitated. Effective from 21 December 2020, ex-factory prices are as follows:
ASTM - A615 - Grade 60
10mm: USD 795/MT
12mm - 32mm: USD 789/MT
The prices being offered by Sub-continent are lucrative enough for Shipowners to consider selling any distressed units in a profitable deal.
The shortage of oxygen remains this week with the rising number of COVID-19 hospitalizations.
Pakistan on Thursday reported 111 COVID-19 fatalities in one day, the highest in a period of the last six months. The second wave is proving more lethal as the Government hospitals are packed to their full capacity and are being forced to turn away patients. The federal government has reinforced its lockdown restrictions and is contemplating closing down more sectors. Prime Minister Imran Khan has closed schools but has ruled out a second lockdown, saying it would decimate the economy.