The downward trend in import
scrap prices in
Turkey, which started in the second week of January, still continues to be observed. HMS I/II 80:20
scrap prices have declined to $174/mt CFR in the latest ex-US
scrap deal heard in the Turkish market, while prices of the same grade
scrap have decreased to $172/mt CFR in the latest ex-UK and ex-Baltic
scrap transactions to
Turkey. Turkish steelmakers have not been aggressively seeking to conclude purchases despite the many import
scrap offers heard in the market. This has resulted in a surplus on the supply side which is believed to be the cause of the decline seen in import
scrap offers.
SteelOrbis has been informed that several Baltic
scrap suppliers are in the Turkish market, with their offers for HMS I/II 80:20
scrap being in the range of $173-175/mt CFR.
In addition, transaction activity for ex-Black Sea
scrap has declined further lately. Suppliers in the Black Sea region are finding it difficult to reduce their offers below $175/mt CFR due to their high
scrap collection costs. Turkish steel producers are accepting to pay higher prices at around $175/mt CFR for ex-deep sea
scrap but are targeting lower prices for ex-Black Sea
scrap. This is the main reason for the decline seen in transaction activity.
There are still many import
scrap suppliers in the Turkish market who have failed to conclude sales for the time being.
Within the import billet market, prices are above the levels targeted by Turkish steelmakers against the backdrop of the Chinese New Year holiday. Accordingly, the volume of billet purchases has declined lately.
Several Turkish steel producers have commenced maintenance works and have temporarily halted their production, trying to reduce finished steel supply in the local market, and accordingly they have raised their finished steel prices slightly. On the other hand, Turkish finished steel export quotations continue to remain under downward pressure, while the current price levels are expected to soften slightly in the coming period.
It is believed that the Turkish steel producers will be in no rush to conclude new import
scrap deals and will continue to exert downward pressure on prices, while they are expected to conclude new bookings only when offers decline to their desired price levels. Considering the high
scrap supply levels in the Turkish market, prices are not expected to improve in the short term. On the contrary, import
scrap quotations for the Turkish market may fall further in the coming period.