The US' largest scrap customer, Turkey, finally concluded a handful of cargo orders from the US, backed by some new orders for their finished products from their local and regional markets. Turkish mills have not been restocking their raw materials to normal levels in recent months due to the uncertain market conditions and often adjust their production according to whether they have incoming scrap shipments.
However, some cargo had to be bought sooner or later. The recent purchases are not excessive and more will need to be purchased within the next few weeks. Thus, the upswing in scrap orders should continue for another week or two.
Then again, demand has not yet improved significantly for rebars or wire rods, and, therefore, many believe that the Turks may stay quiet after this short flurry of buying activity. Even if the demand for Turkish longs remains steady, it is expected that the region's producers will have satisfied their inventory requirements by late May, leading to a soft June.
Nevertheless, this rise in Turkish demand for scrap has been a catalyst for the current price increases out of the US East Coast. Prices out of the US East Coast have been heard to be at the $250/mt C&F Turkey level; however the last bookings to Turkey from the US was concluded at $240-$245/mt C&F. It is not known whether the recent up-tick in demand for Turkish longs from the international market will be enough to sustain the recent buying activity by Turkish producers.
While many suppliers out of the US East Coast have had minor success in cementing rate increases, Far East suppliers have not found the same fortunes. With China still sitting on the sidelines, Vietnam, Korea, and Taiwan have remained somewhat active, prompting US suppliers on the West Coast to push for an increase. However, with most Far East producers sitting on adequate stocks, US suppliers are finding strong resistance to any significant price increases. Current prices out of the US West Coast have been seen at $265/mt C&F Vietnam, $245/mt C&F Korea, and $240/mt C&F Taiwan, all for HMS I/II 80:20. With the upcoming Japanese and Chinese holidays, no change is expected in the Far East scrap market within the next week.