Following the total silence observed in the import scrap market during the week-long end-of-Ramadan holiday, Turkey bought an ex-Baltic cargo at a slightly lower price at the beginning of the current week.
Turkey’s scrap and finished steel markets are still not fully active. Sources also report that scrap collection prices in the EU have declined over the past week to €300-305/mt DAP, from €310-315/mt DAP, while a German-based sub-collector admits that there have been sales of small tonnages in the lower price range. According to another German sub-collector, “Collection prices were pushed down amid the absence of Turkey. There is potential for a recovery since we cannot reflect this drop in our own collection prices. Scrap availability has not recovered much. Hence, we are inclined to increase our inventory levels instead of accepting these price levels.”
Towards the end of the week, the number of buyers in Turkey’s import scrap market has risen. Turkish mills are seeking cargoes, with SteelOrbis hearing that one is looking for prompt shipment. On the other hand, sellers are maintaining their offer prices, but are not bending the lower bids coming from Turkish mills. The euro has started to recover against the US dollar once again this week and it will need to be monitored to see whether it will provide further support for European scrap suppliers.
The sluggish demand in the local Turkish rebar market continues. Some traders surveyed by SteelOrbis report that the current economic indicators and the sharing of VAT between buyer and seller in rebar trading constitute obstacles to more active trading. As reported previously, Turkey has restricted exports of 54 product groups to Israel, citing its continuing violations of international law with its attacks on Palestinians in Gaza since October 7 last. In the January-February period this year, Turkey had exported 49,990 mt of rebar to Israel. This means that, if the same pace were maintained, a total of 300,000 mt of rebars would be exported from Turkey to Israel over the current year. Another important market, Yemen, imported 102,521 mt of rebars from Turkey in the same period, but it is also a difficult destination for Turkish sellers at present due to the military activity in the region. Turkish long steel producers will depend more on their domestic markets in the coming days.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved sideways week on week. The prices are now 0.33 percent higher month on month in the deep sea segment, with prices being in the range of $379-384/mt CFR.
Early predictions for the US scrap market are pointing to another possible sideways trend in May, as overall scrap demand and supply remain mostly balanced. Last week, some sources speculated that mills might try to take scrap prices down slightly, but so far sellers have not shown much willingness to sell lower, especially considering HRC prices have seemed to stabilize and other finished steel products are trending sideways as well.
SteelOrbis has learned that the current price for Mexican domestic shredded scrap is still at MXN 6,550/mt ($389/mt) ex-works, unchanged in pesos in the past week. Additionally, HMS I/II scrap prices are also still being heard at MXN 4,650/mt ($276/mt) ex-works, unchanged in pesos in the past week.
After four weeks of stability, local scrap prices in Italy have risen by an average of €5-10/mt this week, as some steel mills with low scrap inventories have been forced to increase purchase prices in order to secure material due to the substantial shortage of raw material in the market. According to sellers, this situation will continue in the coming weeks, leading to further rises for the month of May.
Steel mills, for their part, are trying to resist the increases in view of the difficult situation in which the finished market has been for some time, as demand for finished steel is not expected to improve. Moreover, several sources said that many domestic producers are working with negative margins and that some mills will take advantage of the holidays between April 25 and May 1 to slow down or stop production.
Traders in the Spanish scrap market stated that local prices have remained unchanged this week, but they reported a slight increase in import scrap prices. According to sources, Spanish steel mills also complain that they are working with very limited margins, despite low energy prices.
The leading Japanese EAF steel producer Tokyo Steel has decreased its scrap purchase price only for its Utsunomiya plant, by JPY 1,000/mt as compared to March 12. The fall in Tokyo Steel’s dollar-based price was steeper due to the depreciation of the Japanese yen against the US dollar.
Tokyo Steel’s general range for H2 grade scrap has remained at JPY 50,500-51,500/mt ($327-334/mt) depending on the mill, while shindachi scrap prices have moved down to JPY 51,500-52,500/mt ($334-340/mt).
This week, Tokyo Bay FAS-based prices for H2 grade scrap have remained at JPY 51,000/mt ($330/mt). This level shows that FOB prices are at JPY 52,000/mt ($337/mt) for this grade.
Import scrap prices and offers in Taiwan are still weak. Despite sellers’ previous attempts to increase offer prices, import scrap deal prices are moving down. Taiwan has been buying Russian billet at relatively low levels over past weeks, after sizable bookings of Chinese billet at even lower levels in early April. Due to the weak import scrap prices contributing to this situation on the billet side, the domestic rebar market in Taiwan has been silent this week. Offers for ex-US HMS I/II (80:20) scrap in containers have remained limited in Taiwan, with offer prices standing at $368-372/mt CFR. Ex-Japan offers for H1/2 (50:50) scrap by bulk to Taiwan have moved down from $372/mt CFR recorded late last week to $368-372/mt CFR.
The import scrap market in Bangladesh has remained in wait-and-see mode this week following the break for the Eid holiday. According to sources, containerized scrap prices have moved up, but deals have remained very sporadic. Offers for ex-EU/UK shredded scrap have settled at around $430/mt CFR, up by $10/mt over the past two weeks, while offers for ex-Australia shredded scrap have settled at around $425/mt CFR, against $420/mt CFR before the holiday. Furthermore, offers for ex-EU/UK HMS I/II 80:20 scrap have been voiced at $410/mt CFR, up by $5-10/mt over the past two weeks, with a deal for around 1,000 mt of ex-UK HMS grade scrap signed at $410/mt CFR this week. Meanwhile, a few deals for small tonnages of ex-Australia HMS grade scrap have been reported at $405/mt CFR, against $400/mt CFR before the holiday. In the meantime, trade activity in the bulk segment has been weak, with offers for ex-US HMS grade scrap heard at $400/mt CFR, the same as two weeks ago.
In Pakistan, most market insiders have not returned to work so far. However, those who have returned have reported rises in import scrap prices. According to sources, most Pakistani customers will maintain a wait-and-see stance until the end of this week and will make new purchases next week, though most anticipate another hike in prices. More specifically, offers for ex-UK/EU shredded scrap in containers have been voiced at $430/mt CFR and slightly higher, versus $420-425/mt CFR before the holiday. According to sources, Pakistani customers have been bidding at $425-427/mt CFR levels, but trade activity has remained very slow and the market has been mostly quiet.