Ex-US scrap bookings to Turkish producers have continued to trend silent since our last report two weeks ago, as Turkish steel producers are unwilling to conclude ex-US scrap deals at current offer prices. As previously reported, sources close to SteelOrbis say that US export yards are still trying to keep offer prices for cargos of HMS I/II 80:20 at $195/mt CFR. Turkish steelmakers, however, have reported seeing increasingly attractive offer prices for Chinese billet; other SteelOrbis sources have said they expect that up to 700,000-800,000 mt of Chinese billet will be delivered to Turkey in January. In that regard, Turkish mills’ attempt to seek lower prices for ex-Us scrap makes sense.
Export yards, however, have had to raise the prices they pay to local scrap collectors in order increase scrap inflow, which has been off by as much as 40 to 60 percent in recent months; thus, selling export scrap cargos to Turkish mills at a reduced price will place pressure on sales margins, which export yards have been unwilling to do. It should also be noted that US domestic scrap yards have also had to increase the prices they pay to local scrap collectors in order to maintain their scrap inflow, which will make it difficult for export yards to reduce their paying price in order to meet Turkish steelmakers price expectations.