Following the previous increase recorded in Turkey’s ex-EU scrap prices, ex-US scrap prices for Turkey have also indicated a rise. As a result, the gap between ex-EU and ex-US scrap prices has almost returned to the traditional levels. Sellers continue to seek to push up their deep sea scrap prices, while Turkish mills are showing demand for scrap, though bids and offers are not ligned.
SteelOrbis has learned that an ex-Belgium deal was closed by a Marmara-based producer yesterday, March 26, for HMS I/II 80:20 scrap at $385/mt CFR, and shredded and bonus grades at $405/mt CFR. The cargo will be shipped in April. This level is very similar to yesterday’s booking done at $385.5/mt CFR.
Meanwhile, a producer in Izmir has closed an ex-US deal for HMS I/II 80:20 scrap at $389/mt CFR, with shredded and bonus grades at $409/mt CFR. The cargo is believed to be for shipment in the second half of April. The level of $389/mt CFR is very similar to SteelOrbis’ estimation for ex-US HMS I/II 80:20 scrap yesterday, which still stands at $390/mt CFR.
A second ex-US booking is rumoured to have been closed by another Marmara-based mill for HMS I/II 80:20 scrap at $387/mt CFR, with bonus and shredded scrap prices standing at $407/mt CFR. This deal has not been confirmed or denied by the parties in question by the time of publication.
Since US-based sellers are now aiming for prices above $390/mt CFR in offers to Turkey, SteelOrbis will keep its ex-US HMS I/II 80:20 scrap prices in the range of $389-390/mt CFR. Many sellers in the US are seeking buyers, while buyers are reluctant to accept higher than $390/mt CFR for HMS I/II 80:20. A source at a Turkish mill commented, “Their expectations for ex-EU scrap remain at $385/mt CFR and slightly above, while ex-US scrap may reach $392-393/mt CFR in the next deals.” Market sources agree that collection prices in the EU do not give any room for a downward correction by European sellers. SteelOrbis hears that a Netherlands-based scrap exporter is currently paying €320/mt DAP for collection. “The collection prices are still firm in the EU. It may be easier for US-based scrap suppliers to sell at more attractive prices. The HRC market in the US is vulnerable. Local scrap prices in the country are expected to remain at soft sideways in April. But US sellers are also not inclined to accept lower than ex-EU scrap quotations,” a seller said. The general idea for now is that there is no significant room for a hike in deep sea scrap prices either. Since Turkey’s finished steel performance is tepid, Turkish mills continue to say that their scrap inventory costs are on the high side. There is some hope for May though. Some market sources believe construction activities in Turkey may make a jumpstart in May due to better weather conditions. SteelOrbis believes that the economic fundamentals in Turkey after the local elections on March 31 will need to be monitored to make a clearer estimation of the possibilities for a revival in the construction sector.