Turkey has concluded several scrap deals from the UK, the US and Baltic with some resistance observed from the US. The Baltic cargo seems to successfully keep its prices firm along with the US, while ex-UK cargo indicates a deeper decline. Expectations of some players have switched to a more positive sentiment following the deals in question, while others still believe the downtrend in Turkey’s scrap market will continue.
The ex-UK deal in question was closed by a Marmara-based producer for HMS I/II 80:20 scrap standing at $368/mt CFR. The cargo will be shipped in late March, early April. This deal was closed $2-5/mt lower than the estimated prices for ex-EU HMS I/II 80:20 scrap. Another rumour has been heard for an ex-EU booking from Netherlands to Iskenderun with HMS I/II 80:20 scrap standing at $372/mt CFR, but this information is rejected by the seller. Seller in question said that “We are not selling today, market has already bottomed out. It will not be long before we see a price reversal”.
The ex-US booking done by an Iskenderun-based mill consists of HMS I/II 80:20 scrap at $381/mt CFR and shredded scrap at $396/mt CFR. According to sources HMS I/II 80:20 scrap tonnage in the cargo is very low, one source states it is only 6,000 mt. “This may have kept HMS I/II 80:20 scrap prices firm, though we see that US scrap suppliers have started to show some resistance to the levels below $380s/mt CFR,” another source commented. Due to the deal in question, ex-US scrap quotations have recovered by $5/mt from the previous deal.
Meanwhile, an ex-Denmark deal has reportedly been signed by a Marmara-based producer for HMS I/II 80:20 scrap at $380/mt CFR. Market sources believe that the cargo will be shipped in April. As a result, ex-Baltic scrap prices have recovered by $6-8/mt.
Lastly, three ex-Cyprus deals have been done by Turkish mills. One of the bookings concluded earlier this week for HMS I/II 80:20 scrap was closed at $350/mt CIF due to the high grade of the material. The other two were closed at $335/mt CIF for HMS I/II 75:25 scrap.
SteelOrbis hears that more sellers have withdrawn from the market, reporting they are in no situation to accept the current price levels. A source from a major Turkish producer thinks “Turkey’s import scrap market may take a breather in the current levels, but still set to decline after this round of purchases”. An ex-EU scrap seller agrees: “There is obviously resistance from sellers, Turkish mills are making inquiries, but their price ideas are lower than sellers. Who will come out as the winner from this deadlock, we will have to wait and see”. Another seller admits that there is little support for scrap from Turkey’s domestic scrap market or from the international steel market, “The respond of Turkish mills to the recent deals will determine the future trend of the market”. An ex-Baltic scrap seller expects further deals today, March 8, adding “But then Ramadan will begin and only afterwards there will be some serious activity”. US scrap suppliers currently aim for prices higher than $380s/mt CFR, several Baltic-based scrap sellers follow suit. European scrap prices including the UK are all over the map, with most players reporting their collection prices have not declined as fast as exports or collection pace has not recovered enough to cause a change in the market. SteelOrbis heard that three major Europe-based producers have also announced cuts in their domestic scrap prices by €10-20/mt, a Germany-based source said the €40/mt cut announced earlier this week by a major EU-based producer did not stick due to low scrap availability. “Weather is still a problem for scrap collection. Prices for collectors are not attractive enough for them to put in more work. Euro-US dollar exchange rate also does not help,” the source said. SteelOrbis has heard that a Belgium-based scrap exporter cut its bids to €290/mt DAP, but the flow to yard is slow. “Stressed cargoes are sold, rest of the sellers are inclined to wait before accepting such levels. Additionally, we see that Turkish mills are more prone to buy one-two cargoes from the current levels. This may mean the market is stabilized. For a clearer picture, we need to see the rebar demand which has not recovered much,” another ex-EU scrap seller commented.