Last week Turkish import scrap market broke its silence which had continued approximately for a month with the ex-Baltic deal for HMS I/II 80:20 scrap in the range of $270-272/mt CFR, while in the current week Turkish import scrap prices have recorded sharp declines. A Turkish steel producer in Izmir has concluded an ex-St. Petersburg deal for HMS I/II 80:20 scrap at $259/mt CFR, indicating a decline of $13-15/mt compared to price levels a week ago. Also another Turkish steel producer has concluded an ex-St. Petersburg deal for a scrap cargo including HMS I/II 80:20 and bonus grade scrap at $255/mt CFR. Market sources state that the main reason behind the lower price level is the low quality of the cargo. Along with the scrap deals, Turkish producers have continued concluding ex-China billet deals as an alternative to scrap. Last week a steel producer in Turkey's Marmara region concluded an ex-China deal for around 50,000 mt of billet at $331/mt CFR, while rumors say that other Turkish producers have concluded billet transactions from China this week.
Market players are wondering the strategy of the scrap suppliers in Europe, the UK and the US, following the broken price resistance of suppliers in Baltic region. European suppliers state that it's very difficult to reduce their prices to the levels recorded in the current week. Meanwhile, it is possible that scrap collectors may stop their collecting activities against the backdrop of summer and the current price levels, if the declining trend of scrap prices continues. On the other hand, senior executives from the largest scrap supplier in the US are in Turkey, visiting their customers. Although no new offer has been given to customers yet, SteelOrbis has been informed that the supplier is testing the water. The US scrap suppliers' offers are expected to be shaped by the local scrap prices' trend in July, which had increased by $10-50/mt in June, depending on the region and grade. The sales pressure on scrap suppliers have increased significantly amid sales activities being at very low levels for a while now. Therefore, Turkish import scrap prices are expected to continue their declining trend in the coming period.