Korean producers have maintained their appetite for US scrap through the summer months, a time when the Far Eastern country would usually take a break from importing US material.
Current prices for ex-US HMS I/II 80:20 to Korea are heard at $305-$315/mt CFR container, up $10/mt from last week, and $350-$360/mt CFR bulk (offer). It is believed that Korean producers will remain in the market for some time, unlike fellow Far East buyers in China and Taiwan. China's construction industry has recently retracted a bit, a market player tells SteelOrbis, which may reduce Chinese steel producers' scrap demand going forward. There have been reports of Taiwanese offers; however, SteelOrbis cannot confirm any bookings.
As Muslim countries approach the month of Ramadan (which extends from August 22 to September 20), some Turkish producers are taking this opportunity to stock up on scrap prior to the religious holiday, anticipating an upward price trend in the post-holiday period. Rates to Turkey from the US East Coast are heard at $317/mt CFR HMS I/II 80:20, up $2/mt from the beginning of last week (freight from US East Coast ports to Turkey sits at the low to mid $30s/mt). However, US suppliers can expect Turkish producers to take a hiatus from deep sea purchases over the course of Ramadan, which could potentially impact rates negatively.
Meanwhile, US domestic order books are slowly increasing as some of the country's idle furnaces are returning to production, with the US flat rolled market in particular showing much improvement in the last couple months. With the tight domestic scrap supply, slightly improving finished product demand and a healthy export market, domestic scrap prices are anticipated to trend sideways to slightly up in the near-term. "The perceived tightness in the market might send some producers scrambling to get their tons on the books," one supplier tells SteelOrbis.
Then again, most market players agree that the export scrap market will most likely continue to be the wild card in the US scrap industry for the near future and that the market may not be able to stay tight without sustained export demand from the Far East and Turkey.