Following the significant price increases recorded in Turkey’s import scrap prices, it is observed that scrap suppliers have accepted the new levels and concluded a high number of deals over the past two days. The total number of transactions done in the past two days is 11, raising questions over how long the current price uptrend will last.
Ex-US scrap bookings have been done by two Turkish producers. A Marmara-based producer has concluded a deal for 30,000 mt of HMS I/II 90:10 scrap at $431/mt CFR, 5,000 mt of P&S scrap at $448/mt CFR and 5,000 mt of shredded scrap at $448/mt CFR. An Izmir-based mill has concluded two other deals from the US with HMS I/II 80:20 scrap standing at $428/mt CFR in both. All the ex-US transaction were done yesterday, December 8. As a result, ex-US scrap prices are fixed at $428/mt CFR Turkey, showing a small correction on the upper end.
Meanwhile, an ex-Germany booking was done by another Marmara-based steelmaker yesterday with HMS I/II 80:20 scrap standing at $421/mt CFR. A Bartin-based producer concluded an ex-Netherlands deal consisting of HMS I/II 80:20 scrap at $422/mt CFR and bonus grade scrap at $442/mt CFR, to be shipped in mid-February. This deal is estimated to be lower than 20,000 mt due to the lower water levels at the producer’s port. Another ex-Netherlands deal was signed as a cargo top-up by an Izmir-based producer, with the HMS I/II 80:20 scrap price reported at $419/mt CFR. Accordingly, SteelOrbis’ ex-Europe scrap reference price has increased by $3/mt.
Lastly, an Iskenderun-based producer has concluded a deal from Klaipeda in Lithuania for HMS I/II 80:20 scrap at $423/mt CFR. This level is $2/mt lower than the estimations made for ex-Baltic scrap yesterday after the ex-US deals.
Turkey’s short sea HMS I/II 80:20 scrap prices have also increased, to $405/mt CFR for Romanian origin, rising by $2.5/mt.
Today, most market players believe that, after such a round of bookings, deep sea scrap prices may stabilize at the current range. The number of offers in the market is now higher than the number of buyers seeking scrap. SteelOrbis hears that Turkish mills may now just monitor the market for some time as their immediate needs have mostly been satisfied. A source at a major mill Turkish stated, “The uptrend has come to an end”, while another source at a mill said he is sure that “stability will be achieved.” A seller based in the EU commented, “There may even be a small space for a correction if the number of offers exceeds demand.” Another seller stated, “Postponements may cause gaps in inventory management and keep prices firm.” A major European scrap supplier said the rise is not linked to demand at all, stating, “This is a cost push. What we gained in sales prices went to freight. We are almost working with zero margins. It is a hard time for sellers.” A German sub-collector said they concluded sales to export yards yesterday, with HMS I/II 70:30 scrap at €327.5-330/mt DAP, HMS I/II 80:20 scrap at €335/mt DAP and E3 grade scrap at €347.5/mt DAP. Another sub-collector in Germany said prices will continue to move up in their region due to insufficient flow. Meanwhile, local US scrap prices in the Northeast of the country have settled with a $30/mt increase. A market source commented, “The situation in the US regarding collection, winter conditions, logistics and some delays might still lead to premium grade scrap quotations over $430-433/mt CFR.” On the other hand, billet prices are on the high side for Turkish mills. Domestic billet prices are in the range of $570-583/mt ex-works, while import billet stands at $540-560/mt CFR Turkey. Domestic rebar prices in Turkey started today, December 8, in the range of $610-635/mt ex-works, while some tonnages changed hands at $608/mt ex-works in Izmir.