The solid demand for scrap from the Turkish producers in past weeks has caused prices of both imported and local scrap to increase. In the few offers heard this week, price levels are observed to have increased, though no transactions have been heard at the new higher levels.
The highest transaction price for ex-US HMS I/II 80:20 scrap has been heard at $347/mt CFR. Although offers at this level or even slightly higher were seen in the market, Turkish producers did not have a positive view of these offers. In an another offer for ex-US shredded scrap, the price level was standing at $360/mt CFR; however, failing to find acceptance, the offer was heard to be revised down to $355/mt CFR.
Along with the increases in the global markets, the rise in the value of the euro against the dollar has also resulted in increases in dollar-based ex-Europe scrap prices. The most recent offers heard from Europe were standing at the level of $344/mt CFR for HMS I/II 70:30 and at $354/mt CFR for shredded scrap.
An offer for ex-Baltic A3 grade scrap has been heard at $354/mt CFR. In Romania, scrap collection prices have increased to the level of $310-315/mt and it is considered impossible for offers for scrap, collected at the mentioned levels, to decline lower than $350-355/mt CFR Turkey. However, since the Turkish mills' purchase price idea is not higher than $335-340/mt CFR, it is thought that scrap collection prices in Romania will have to be revised.
The approach of Ramadan has created an uncomfortable feeling in the steel product markets. However, it is thought that the Turkish mills will decide their scrap purchasing strategies taking into account that after Ramadan the steel product markets will likely gain momentum by September. Looking at inventories, following their recent bookings, the Turkish mills do not urgently need to purchase scrap. It is thought that the situation in the steel product markets will also continue to influence scrap purchase activity for a while.