The continuing rise in freight rates is causing both deep sea and Black Sea scrap prices to rise further in the Turkish market.
In a booking concluded for scrap ex-US last week, 28,000 mts of HMS I/II 80:20 was booked at $334/mt, 8,000 mts of shredded scrap was booked at $339/mt and 4,000 mts of P&S scrap was booked at $344/mt CFR Nemrut. Compared to the previous booking, we see that prices have increased by $8-10/mt. The main reason for this hike is the further increases in freight rates. While there is no change in the FOB prices ex-US East Coast, the higher freight rates have caused prices on a CFR Turkey basis to increase by the specified margin.
In the event of further increases in the freight rates, it is thought that deep sea scrap prices will increase by the same amount; however, if freight costs remain unchanged, scrap prices are thought likely to follow a stable trend.
A similar situation is observed with respect to scrap ex-Black Sea. Since transportation activity is dense due to the arrival of the grain season, it is difficult to find a ship, and even if a ship is found, one now has to face higher freight rates. In the latest booking heard, A3 scrap ex-Russia has been booked at $335/mt CFR Nemrut. Offers for A3 scrap ex-Black Sea have increased above $335/mt CFR level.
With regard to small tonnage cargoes, offers ex-Algeria are at $325-330/mt CFR, while offers ex-Israel are at $325/mt CFR.