Turkey’s import scrap market has found some balance with ex-EU and ex-US prices settling at the more traditional levels compared to each other earlier this week. The overall price trend has continued to remain soft over the past five days, with several deals closed, but each with small price declines. While European scrap suppliers tell SteelOrbis that their collection prices have remained firm and will not give them room for further price reductions, the negative sentiment in Turkey’s rebar market has had a big impact on the scrap segment. Not only in longs, but sentiment in the local Turkish flat steel market is also negative. While Turkish mills are trying to complete their purchases for June shipments, already with approximately 25 deep sea cargoes bought, they are also trying to avoid taking risks and want to lower their input costs. Some Turkish mills are ready to buy for July shipments, while others still need cargoes for June shipments.
New deals heard today indicate that current levels of deep sea scrap prices are attracting interest. An ex-UK booking is rumored to have been done for HMS I/II 80:20 scrap at $373.5/mt CFR, shredded scrap at $398.5/mt CFR and bonus grade scrap at $398.5/mt CFR. The level increases the general range for ex-EU benchmark scrap prices by $0.5/mt from $372-373/mt CFR before.
Meanwhile, an Izmir-based producer has concluded an ex-Denmark deal with HMS I/II 80:20 scrap and bonus grade scrap standing at $379/mt CFR and $399/mt CFR, respectively. The price is $0.5/mt lower than the previous ex-Baltic booking.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved down by 0.86 percent week on week. The prices are now 2.08 percent lower month on month in the deep sea segment, with prices being in the range of $372-379.5/mt CFR.
Steel Orbis has learned that in the US the dock-delivered price range for HMS I/II 80:20 scrap in Philadelphia is now being heard at approximately $280-290/gt. With New York HMS I/II scrap prices now at $280-290/gt.
SteelOrbis has learned that the current price for Mexican domestic shredded scrap has increased by MXN 200/mt (12$/mt) over the past week to MXN 6,450/mt ($377/mt). Additionally, HMS I/II scrap prices have risen by MXN 200/mt (12$/mt) over the same period to MXN 4,850/mt ($283/mt).
Over the past week, many Italian steel mills have lowered their scrap purchase prices by €5-10/mt, signalling to the market a definitive halt to increases. However, the contracts closed this week were signed at the same levels as last week or slightly lower. According to another trader, the market is quite sluggish and there is little activity on both the scrap collection and sales sides, as some steel mills have suspended deliveries this week and are planning slowdowns or shutdowns to cope with the weak finished market.
Some market participants expect declines starting next week due to the difficulties in the finished steel market. Other traders, on the other hand, expect prices to remain stable as there is still a substantial shortage of scrap and they are buying scrap at high prices.
Local scrap prices have remained mostly unchanged in the Spanish market, with only a slight increase of €5/mt for HMS and shredded. Energy prices remain low in Spain and so they are attractive for producers, who are buying cargoes with fast delivery times to take advantage of the situation, preferring local scrap.
South Korean steelmaker POSCO has announced bids for Japanese scrap. POSCO has shared its bids for Japanese shredded scrap at JPY 57,500/mt ($368/mt) CFR. This level indicates that the FOB-based price for Japanese shredded scrap is at around JPY 54,500/mt ($349/mt).
Taiwan’s import scrap market has remained stable this week, with only small declines observed in Japanese scrap offers. The Taiwanese rebar market this week has been sluggish in terms of trading, market sources report, because end-users have been asking for lower rebar prices to conclude actual deals, but Taiwanese mills have resisted their requests. Offers for ex-US HMS I/II (80:20) scrap in containers are still at $350-355/mt CFR, unchanged week on week. Deals have been closed at around $348-350/mt CFR, the same levels as recorded last week.
Ahead of the rainy season in Vietnam, market sources report that there is some interest in buying scrap. However, the current offer prices coming from abroad are still considered high. SteelOrbis has learned that Japanese H2 scrap offers to Vietnam have remained in the range of $370-380/mt CFR during the past week.
This week, Tokyo Bay FAS-based prices for H2 grade scrap have been at JPY 50,000-51,500/mt ($318-328/mt), up JPY 500/mt on the upper end.
As a result, SteelOrbis’ reference price for ex-Japan H2 scrap is currently at JPY 51,000-53,300/mt ($324-339/mt) FOB. The lower end represents the Tokyo Bay prices and the upper end is represented by Vietnamese producers’ workable levels.