After beginning the month of May with an uptrend in prices, players in the Turkish import
scrap market concluded more than 10 ex-US
scrap deals in the second week of month and the increase in import
scrap prices gained momentum. Early last week, Turkish steel producers accelerated their negotiations with
scrap suppliers for bookings for June shipments and in response to this higher demand
scrap suppliers began to offer higher prices. While US suppliers'
scrap offers were heard to be over $280/mt CFR early last week, it was unclear whether this increased price would be accepted by Turkish steel producers. In the middle of last week, it was heard that a Turkish steel producer concluded an ex-US deal for HMS I/II 80:20
scrap at $281/mt CFR, while prices continued to increase afterwards. Many ex-US import
scrap deals for HMS I/II 80:20
scrap in the Turkish market were concluded at $284/mt CFR at first. Then the gradual increase in prices continued and deals were concluded at $287/mt CFR and $289/mt CFR. In addition, an ex-Baltic deal for HMS I/II 80:20
scrap was concluded at $285.5/mt CFR towards the end of the week. The import
scrap market in
Turkey has made a quiet start to the current week in terms of transaction volumes. However, since some steel producers are heard to be looking for
scrap cargos, new import
scrap deals are expected to be concluded in the coming days.
The rapid increase in import
scrap prices has come as a surprise to global market players, raising the question of whether prices will increase to $300/mt CFR, a level which was last seen in January this year. In response to increasing import prices, some Turkish steel producers have started to make inquiries for import billet instead.
Scrap suppliers will certainly face downward pressure on their prices if Turkish producers begin to conclude deals for billet imports at reasonable price levels. However, when considering the current situation, the uptrend of
scrap prices reduces the sales pressure on import
scrap suppliers, who have adopted a strong stance on their prices since they have been seeing decent demand from Turkish steel producers. Also, finished steel sales in the Turkish market are at quite decent levels and Turkish traders' finished steel price increases have gained acceptance amid tight supply seen in some regions of the country. This situation is also providing support for import
scrap suppliers' prices. Accordingly, import
scrap prices are expected to remain firm as long as Turkish market players' finished steel sales and producers' demand for import
scrap remain on the high side.