According to Assofermet's regular monthly market note, the Italian ferrous scrap market recorded a general price increase of €5-15/mt for medium-to-high grades in September, while demand and scrap availability remained at acceptable levels, slightly above expectations.
The increase was supported by purchases by some steelmakers which, following the sharp price cuts implemented during the summer months, found themselves with reduced inventories, as well as by Turkey's scrap purchasing activity. However, higher energy costs, which have reached an impact of up to around €60/mt, prompted several steel plants to reduce shifts or temporarily halt operations, curbing domestic scrap demand. For October, Assofermet sees the outlook ranging from stability to moderate optimism. “If production returns to a reasonable pace, further price improvements can be expected,” the association stated in its note.
International market - Turkish prices up $25-30/mt, freight rates impact market
In the international market, the upward trend that began in late August accelerated, particularly in Turkey, where scrap prices increased by $25-30/mt. The rise was supported by a recovery in demand, but above all by higher logistics costs and ocean freight rates. Geopolitical tensions have reduced vessel availability and increased transit times, insurance costs and war risk premiums.
Asian markets also recorded increases, although these were more limited due to weak demand. In Europe, meanwhile, the trend remained more uncertain, with price increases concentrated mainly at the end of September and with significant differences between countries and individual buyers.
Stainless scrap demand remains weak, India supports exports
In the stainless scrap segment, demand from Italian and European stainless steel mills remained weak. Purchasing activity was also limited in anticipation of substantial volumes of imported billets expected to arrive by the end of the year. Despite the decline in nickel prices on the London Metal Exchange (LME), stainless scrap prices recorded a modest rebound, mainly due to reduced material availability rather than any real recovery in consumption.
India continues to represent an important export outlet for stainless scrap, absorbing volumes that would otherwise struggle to find buyers in the domestic market. According to Assofermet, exports are therefore expected to continue playing a key role in supporting the market during the final quarter of the year.
Pig iron prices stable, but freight rates and energy crisis weigh on European market
In September, basic pig iron prices at origins remained broadly stable, while final prices in Europe were negatively affected by the weaker exchange rate and the worsening energy crisis. In the Black Sea region, exports are effectively blocked from both Ukraine and Russia.
Brazilian basic pig iron prices remained at around $440-450/mt FOB, but the cost of material delivered to European ports remained high due to the increase in freight rates from Brazil, which rose from $38/mt to around $50/mt, as well as the weakening of the euro. In the United States, meanwhile, imports increased by 50 percent in September, supported by substantial arrivals from Brazil and Ukraine.
As regards hematite pig iron, demand remained weak and transactions sporadic, while some price increases were driven mainly by higher transportation costs and upward revisions to producers' FOB prices. Limited visibility for the final quarter and uncertainty surrounding CBAM continue to encourage a cautious approach to inventory management.
The ductile iron segment also remained broadly stable, with unchanged prices at origin and structurally weak demand from foundries.
Ferroalloys market moves at two speeds
The Italian ferroalloy market showed mixed trends in September: manganese and silicon alloys remained weak due to production slowdowns at steel mills, while ferrochrome and noble alloys showed greater activity and slight price increases.
According to the note, European producers have indicated that Chinese trade flows are shifting towards Angola in an attempt to circumvent EU antidumping duties, while the European Commission is said to have launched an interim review. The ferrochrome and noble alloy segment, meanwhile, showed greater activity, with slight upward adjustments in prices. Overall, Assofermet therefore describes a divided market, with bulk ferroalloys held back by weak consumption and specialty products proving better able to defend their margins.
