Since the beginning of the week, Turkey’s import scrap market has followed a stable trend and there has been no rush in the market in terms of trading. The first bookings heard from Europe were from late last week but were followed by fresh deals, with prices not changing.
Market sources largely believe that deep sea scrap quotations will remain in a narrow range. A slight increase in prices is thought possible, but no decrease is expected in the coming days. “US suppliers are also fond of their margins is what I see. So, they are not pushing for an increase either,” a European scrap supplier told SteelOrbis.
Turkish mills still need scrap for shipment in August, while resistance is observed to higher price levels. While a few European scrap suppliers believe the current price levels are not acceptable, others are inclined to continue their sales. A source at a major Turkish mill said that sellers are willing to accept the current levels, adding, “There is no upward push for scrap. Some Turkish mills procured various materials from Asia, while others are trying to complete their needs by purchasing semis and scrap. Deep sea scrap prices will move in a narrow range, with the potential to soften slightly.”
But, generally, players in the local rebar market, traders or producers, do not have much hope for a demand revival during the summer. “We are in the third quarter now. There is very little appetite in the market for construction. I do not think that will change in the last quarter of 2024 with the winter creating obstacles.” As a result, Turkey’s import scrap market is expected to remain firm and just move sideways for now.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved up by 0.06 percent week on week. The prices are now 1.57 percent higher month on month in the deep sea segment, with prices being in the range of $384-390/mt CFR.
US scrap prices for July settled sideways to down in the US Ohio Valley amid low finished steel prices, and sideways to higher in the East given strong export demand and reports of reduced inventories at scrapyards, market insiders told SteelOrbis this week. In the Ohio Valley, market insiders said continued low demand for finished steel goods such as appliances and automobiles has resulted in increased scrap inventories at steel mills, prompting producers to offer lower scrap prices across the board.
SteelOrbis has learned that the current price for Mexican domestic shredded scrap has remained stable over the past week at MXN 7,150/mt ($393/mt). Additionally, HMS I/II scrap prices have remained unchanged over the same period at MXN 5,450/mt ($300/mt).
Over the past week, local scrap prices in Italy have dropped by a further €5/mt on average and, according to sources, the market is now waiting for the holiday period. Production halts will begin very soon and business activity is at a low level. A scrap trader noted, "Many are already postponing purchases until September, except for those who need spot contracts.” Also influencing the low demand for scrap are the large quantities of scrap that have arrived by ship from the US and South America in recent weeks.
Traders therefore expect scrap prices to remain stable in the short term, and some expect them to remain stable in September as well. Producers, on the other hand, are thinking about further price declines for scrap in the coming weeks.
The local scrap market in Spain has remained stable this week. Sources report a shortage of shredded scrap that could put pressure on prices in the coming weeks. On the contrary, there seems to be an oversupply of HMS in the market, and so market participants think that prices in this category may fall in the short term.
While the Japanese yen-based price has increased in Japan’s Kanto scrap export tender, the depreciation of the Japanese yen has caused the dollar-based price in the tender to decline, as compared to last month’s tender. In the Kanto export tender, the highest bid was at JPY 52,168/mt FAS, JPY 804/mt higher than last month. The buyer was Vietnamese.
The leading Japanese EAF steel producer Tokyo Steel has announced an overall decrease of JPY 500/mt in scrap purchase prices at all of its plants. After the announcement, Tokyo Steel’s general range for H2 grade scrap has decreased to JPY 49,500-52,000/mt ($311-327/mt) depending on the mill.
Taiwan’s import scrap market has remained stable this week. Meanwhile, the Taiwanese rebar market is sluggish in terms of trading “due to hot weather and Asian billet prices,” a source commented. Offers for ex-US HMS I/II (80:20) scrap in containers have moved up by $1/mt on average this week and are now at $347/mt CFR. Ex-Japan offers for H1/2 (50:50) scrap by bulk to Taiwan have been relatively stable over the past week, moving only from $356-362/mt CFR to $355-360/mt CFR.
Due to the monsoon season, Vietnamese buyers are showing little interest in scrap imports and the bids from mills are lower than the offered price levels. SteelOrbis has learned that Japanese H2 scrap offers to Vietnam are currently at around $365-370/mt CFR.
Meanwhile, the South Korean domestic scrap market has been weak for a very long time. One market source stated, “The price of rebar has gone below the production cost, so the mills have been trying to push the price at least above the production cost. Hence, they cut their production rates further this month.”
On July 11, POSCO has shared bids for Japanese HS scrap at JPY 60,000/mt ($377/mt) CFR, JPY 1,000/mt or $11/mt higher than the Japanese yen-based bids shared by the producer for this grade on July 4. Meanwhile, POSCO’s bids for shredded scrap are at JPY 59,500/mt or $374/mt CFR.