Turkish steel producers, who have concluded many import scrap deals during the past two weeks, seem to have withdrawn from the import scrap market, since they have eased their needs for import scrap and are receiving Chinese billet offers at more favorable levels than scrap prices.
With the deals concluded in Turkey during last week, ex-Baltic and ex-US prices for HMS I/II 80:20 scrap increased by $3-6/mt week on week to $197.5-201/mt CFR. Even though domestic scrap prices in the US market were expected to decline in November, they have moved on a sideways trend instead, especially on the East Coast, against the backdrop of lack of strength of domestic scrap demand and decent demand for US scrap from Turkish producers. Accordingly, the current slowdown in Turkish scrap demand is expected to be reflected in downward movement of domestic scrap prices in the US.
On the other hand, ex-Europe deals concluded last week in Turkey for HMS I/II 75:25 scrap were in the range of $192-193/mt CFR, while deals for HMS I/II 80:20 scrap were at $195.5-198/mt CFR. Although Turkish producers are willing to pay higher prices for these qualities of scrap compared to prices in the local European market, they are not willing to do likewise for higher grades of scrap.
There are still a few suppliers offering cargos in the import scrap market in Turkey, while Turkish producers have started to put downward pressure on import scrap prices. The main reasons for the downward pressure are Turkish producers’ relatively high scrap stocks, their problems with foreign buyers regarding finished steel export prices amid higher scrap prices, and attractive Chinese billet offers. In the coming period, scrap suppliers seeking to conclude sales to Turkey are expected to accept lower prices.