Turkish steel producers, which had been expected to start their scrap purchases after the end-of-Ramadan holiday, are observed to be still delaying their purchases. In the past two weeks, although ex-Europe scrap prices have registered decreases, ex-US scrap prices are reported not to have declined as expected.
With scrap demand not being too strong in the US domestic market, prices have again declined following the increases seen in early September. However, this decline has yet to be reflected in offers to Turkey. An ex-US offer for HMS I/II 80:20 at $395/mt CFR and shredded scrap at $400/mt CFR has been heard in Turkey, but there have not been any confirmed sales heard yet. For a while now Turkish producers have preferred to buy ex-Europe scrap.
In the bookings heard last week, ex-Europe HMS I/II 70:30 prices are seen to have declined from $392/mt CFR to $381/mt CFR in the space of two weeks. While strong demand was expected in Europe after the summer holidays, the weak demand from mills up to now has resulted in an abundance of scrap supplies. While an ex-Europe offer was heard at the level of $381/mt CFR last week, no bookings have been concluded in Turkey yet.
Different price levels are heard for ex-Black Sea A3 grade scrap. Romanian and Russian offers are currently standing in the range of $395-400/mt CFR; however, there have been bookings at $390-395/mt CFR in the past week. Prices below the level of $390/mt CFR are heard from Bulgaria and Ukraine. With scrap collection prices still at high levels in Romania, it is impossible for ex-Romania offers to decrease to these levels. Meanwhile, an ex-Baltic scrap cargo composed of A3, bonus grade and shredded scrap has been sold in Turkey at the price level of $400/mt CFR.
Along with the mills' expectations for a decrease in scrap prices, lack of demand on the product side has prompted mills to postpone their scrap bookings. The mills are expected to return to market in order to complete their remaining bookings for October after postponing for another while.