In new deals closed this week, Turkey’s deep sea scrap prices have moved down at a slow pace.
An ex-US scrap deal done by an Iskenderun-based producer was signed yesterday, May 22, for HMS I/II 80:20 scrap at $379.5/mt CFR, with shredded and bonus grades at $399/mt CFR. This price is $0.5/mt lower than the previous ex-US deal price.
Meanwhile, two European scrap bookings have been done since yesterday. An ex-UK deal was done by an Izmir-based producer for HMS I/II 80:20 scrap at $373/mt CFR and shredded scrap at $398/mt CFR. The $25/mt gap between the two grades attracted attention. Additionally, an ex-Netherlands transaction closed by a mill in the Marmara region indicated a further $1/mt fall in the ex-Europe price. The cargo consists of HMS I/II 80:20 scrap at $372/mt CFR and bonus grade scrap at $392/mt CFR. Accordingly, SteelOrbis’ ex-Europe scrap reference price has been revised down by $1/mt to $372.5/mt on average.
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. Currently, ex-Turkey rebar prices are at around $575-585/mt FOB June-early July shipment, versus $585-600/mt FOB a week ago. Lower price levels have been voiced by market players, though they were largely considered to be for special cases. In the Turkish domestic rebar market, the general official rebar prices vary at $585-620/mt ex-works, while the workable rebar prices seem close to $585-600/mt ex-works for serious buyers, both falling another $5/mt week on week. Some softening has been seen in the local Turkish hot rolled coil (HRC) segment and, given the persisting lack of business activity, several spot traders have decided to provide discounts to attract the attention of consumers. Import scrap prices in India have lost ground but have still failed to trigger strong demand, with buyers even submitting lower bids and waiting for the downtrend to gain further momentum before concluding bookings. Considering the ongoing slow local sales for finished products in Pakistan this week, demand for imported scrap has also remained sluggish, while only occasional deals have been reported at lower levels.
It is important to note that Turkey’s central bank has decided to keep interest rates stable at 50 percent in its announcement made today, May 23. This was not a surprise and is the second consecutive decision which has left interest rates unchanged. The Turkish lira-US dollar exchange rate now stands at 32.21, with the lira strengthening very slightly after the announcement made by the central bank.