Turkish import scrap prices from the US moved up $5-7/mt this week to HMS I/II 80:20 at $215/mt CFR, shredded scrap at $220/mt CFR, and P&S/Bonus at $225/mt CFR compared to previous deals. The market is quiet today after a buying spree throughout the week of approximately 170,000 mt by Turkish mills. As the premium for US-origin HMS I/II 80:20 over UK and Northern European scrap seems to have narrowed, thereby, making US scrap more competitive, East coast scrap suppliers have gained hope for additional transactions in October.
Russia, Netherlands, and the UK have been the other principal scrap suppliers to Turkey and have put pressure on US export pricing over the summer. With Ukraine tripling its export duty in September on ferrous scrap to €30/mt ($33/mt) from the current €10/mt ($11/mt) for a one-year period, it has become one less source of competition for US scrap.
Turkish mills continue to contend with weak demand for their finished goods, but indicators such as the slight recovery of rebar export prices over the past week and substantial flat exports to the US in August and September compared to 2015 further support expectations for sustained scrap export pricing according to several sources close to SteelOrbis. As one trader commented, “International scrap prices have been showing mixed dynamics but it seems to be leveling off and some fundamentals are better than fourth quarter 2015.”
1 US Dollar = 1.115 Euros, 10/6/2016