Taiwan increased domestic scrap prices through December as import prices from short and deep sea sources increased. The prices in the US West coast climbed as expectations of additional Turkey demand on the East coast and domestic demand throughout all US regions would bolster prices upward during the January buy-cycle.
In late December, US West coast offers were few and Taiwan was limiting its consumption to domestic sources per expectations of a softer import market in January. West coast offers for HMS I/II 80:20 were heard at $265-275/mt CFR for the week ended December 30. The most recent deals to Taiwan were heard completed in the range of $250-260/mt CFR with the latest reaching the $260/mt CFR level. These prices translated to approximately $240-245/mt FAS at a West coast port.
Turkey has stayed away from the deep-sea import scrap market for the last several weeks given weak finished steel demand, poor weather, domestic political challenges and recent power cuts. This influencing development along with a softer Chinese steel market has resulted in Taiwan steel firms decreasing their domestic scrap prices. From December 18, 2016, domestic scrap prices for HMS, shredded and P&S delivered were heard falling by 2-3 percent at some of the larger Taiwanese mills.
As the US buying cycle from domestic mills is presently ongoing, expectations are for US domestic scrap prices to increase $10-20/mt in the East coast and possibly $30/mt in the Midwest and Southeast regions. US West coast exporters are expected to return to the market with updated pricing next week, but a decline in Taiwan's domestic scrap market will place downward pressure on the West coast.