According to market sources, Turkey's import scrap market has seen lively activity over the past week.
Turkish producers have continued negotiations with the scrap suppliers and have got the price levels they were asking for due to Chinese producers' aggressive billet offers. Accordingly, Turkish producers have increased their scrap purchases for October shipments.
Many import scrap transactions have been heard in Turkey over the past week. A Turkish steel producer has concluded an ex-Baltic scrap booking in the past week for HMS I/II 80:20 scrap at $370/mt CFR, indicating a decrease of $10-13/mt compared to the previous ex-Baltic transaction heard two weeks ago. Also last week a Turkish mill concluded an ex-US booking for HMS I/II 80:20 scrap at $370-371/mt CFR, indicating a decrease of $4-5/mt from the previous week. At the beginning of this week, an ex-Europe deal to Turkey for HMS I/II 75:25 scrap, HMS I scrap and of a mix of bonus and busheling scrap was concluded at the average price level of $360/mt CFR. As of September 22, no new import scrap transaction has been heard in the Turkish market.
Even though Turkish producers have concluded many scrap deals for October shipments, market sources indicate that some mills have not completed replenishing activities for their basic scrap needs. Thus, scrap purchases in the Turkish import scrap market are expected to continue in the coming days. Meanwhile, iron ore prices have decreased below the $80/mt threshold today, September 23. Accordingly, Chinese producers which use iron ore for their billet production are expected to offer lower billet prices to the Turkish market. If Turkish producers continue their strategy to use Chinese billet for production instead of scrap, the downward pressure on scrap suppliers' prices will increase. Turkish producers are expected to demand new discounts from scrap suppliers before completing any new transactions.