Following the Eid holiday, imported scrap prices in the Bangladeshi market have risen by $2-3/tonne this week, with offers from some sellers increasing by $5-7/t, according to Kallanish.

Brazilian-origin HMS scrap transaction prices are currently assessed at $412-415/t cfr Chattogram, with offers reaching $417-420/t cfr.

This price rise, despite sluggish demand, is attributed to increased freight rates for July.

The freight rate for a 20-foot container from Brazil/Australia to Bangladesh has surged by $500 per container, equating to approximately $20/t, as per market participants.

"The detouring of ships due to the ongoing Red Sea issue has led to container shortages and port congestion. Containers are bypassing ports, causing tight availability in Far Eastern countries like Hong Kong and Malaysia, resulting in monthly freight rate increases," says a Dhaka-based scrap trader.

Scrap demand remains slow as buyers are still returning to the market after the holiday.

"With the ongoing monsoon season in the country and slowed construction activities, any major uptick in domestic steel and scrap demand seems unlikely in July,” remarks another scrap trader based in Dhaka.

However, despite tepid demand, sellers indicate they have no choice but to pass on the increased freight costs to consumers.

In the long run, steel consumption in Bangladesh is projected to rise by 25%, from 8.5 million tonnes in 2024 to around 10.6mt in 2027, driven by growing infrastructure development projects and individual consumption, according to market reports.