As difficult winter conditions hit Europe and America, scrap collection activities have become more difficult. Scrap prices in Turkey, which have been on a rising trend for a long time now, have continued to increase, with each scrap booking being concluded at a higher price than the previous one.
In the US domestic market, it is reported that local mills' scrap inventory levels are still low, while local scrap demand continues its strong trend. Market players from the US steel market expect scrap prices to increase by a further $45-50/mt in early January. The latest ex-US scrap transaction to Turkey, which was concluded last weekend, was at $460/mt CFR for HMS I/II 80:20 scrap, at $465/mt CFR for shredded scrap and at $470/mt CFR for P&S scrap. Although no new offers have been heard so far this week, prices are expected to exceed these levels.
In Europe, scrap collection activities have become extremely difficult due to heavy snowfalls. After last week's ex-Europe HMS I/II 70:30 scrap booking to Turkey concluded at $445/mt CFR, there have not been any new offers or transactions heard yet. In early January, domestic scrap prices are foreseen to increase by as much as €50/mt ($66/mt).
Ex-Black Sea A3 scrap offers have been increasing gradually on a daily basis, with each booking level observed to be higher than the previous one. While ex-Romania A3 scrap offers to Turkey are currently standing at about $455/mt CFR, steel mills have not yet accepted any offers above $450/mt CFR Marmara. On the other hand, the ex-Baltic A3 scrap price for Turkey is higher than $460/mt CFR.
Scrap offers from the Mediterranean region to Turkey vary. Ex-Lebanon scrap offers to Turkey stand in the price range of $430-440/mt CFR, depending on the material's quality, while offers up to $450/mt CFR are also heard. Meanwhile, ex-Israel scrap offers to Turkey are currently at $420/mt CFR.
In recent weeks, Turkish producers are observed to have continued their scrap bookings in a regular and deliberate manner. These producers are planning their scrap purchases taking into consideration price increases seen both in the finished product market and in the scrap market. With the continuing difficult winter conditions, as well as the start of the holidays, scrap supplies are expected to become tighter, resulting in stronger scrap prices in the short term.