Turkey continues to conclude deep sea scrap deals at higher price levels, despite the lack of steel demand in the domestic and export markets. Since Turkish mills have decided to keep their production capacity utilization rates relatively stable, higher price levels continue to be seen in scrap bookings.
A Marmara-based producer has concluded a deal today, November 8, with benchmark HMS I/II 80:20 scrap standing at $373/mt CFR, pushing Baltic scrap prices to the anticipated levels.
Another ex-Denmark deal is rumored to have been closed at $375-377/mt CFR for HMS I/II 80:20 scrap by a Black Sea-based Turkish producer. However, this deal has not been confirmed by the buyer or the seller by the time of publication. SteelOrbis has revised its reference price for ex-Baltic HMS I/II 80:20 to $373-375/mt CFR.
Any higher levels are expected to be met with resistance from Turkish mills. One source from a major Turkish mill said today, November 8, “If producers buy deep sea scrap above $375s/mt CFR, I do not know how they can expect to sell finished steel to the local or export markets. Trading in the local Turkish rebar market is once again sluggish. And if the government does not make any moves ahead of the local elections to be held on March 31, a significant recovery in the local rebar market is not expected. Meanwhile, the recovery observed in export sales when scrap prices declined to around $350s/mt CFR has disappeared again. A source at another major Turkish mill said that deep sea scrap prices may move up to $375s/mt CFR on average, though he added, “These levels are not sustainable and makes us producers vulnerable.” A European scrap supplier commented on the current situation stating, “Purchases this month started earlier than anticipated and prices are tending to move up to $380s/mt CFR.” SteelOrbis has been informed that a German sub-collector concluded sales to a Belgium-based export yard, with HMS I/II 70:30 scrap at €300/mt DAP, HMS I/II 80:20 scrap at €310/mt DAP and bonus grade scrap at €320/mt DAP. The same supplier sold HMS I/II 70:20 scrap to an Amsterdam-based export yard at €302/mt DAP. As a result, it is safe to say that the uptrend of deep sea scrap quotations will continue for the time being.