Although the Turkish scrap market has been significantly calm since last week, demand level in this market has this week been almost stopped. Due to the fact that the price of finished steel products in Turkey has not registered a revival, even they have declined furthermore; the Turkish mills are buying scrap with small tonnages in line with their necessity.
It is heard that the demand in the US domestic market is also sluggish. In the past week, the offers of the US scrap suppliers to Turkey have declined to the level of $265/mt CFR for HMS I/II 80:20. Although it has not this week been heard any price idea from this region yet, the Far East suppliers' interest to scrap may affect the offer prices from the US.
Demand activity in European domestic markets have also almost stopped as SteelOrbis has been informed. Price levels of the European suppliers' offers to Turkey have been at $252/mt CFR Turkey for HMS I/II 70:30 in the past week. No offer has been heard this week yet due to lack of demand.
Strong winter in Black Sea region, in Russia in particular, has been causing the scrap collecting activities in a negative way. Although it is heard that the scrap supply level in Russia is not currently strong, ex-Russia A3 grade scrap price cannot be able to compete against the other regions' scrap offers in Turkey. However there have been purchases with small tonnages, ex-Romania A3 grade scrap prices in Turkey have been at $255-260/mt CFR Turkey.
For now, the most critical point for the Turkish mills is the situation of the finished steel products' market. A possible revival in finished steel products may cause the Turkish mills to return to the scrap markets. However, if there will be no revival in the finished steel products, Turkish mills may have to take some serious decisions; such as, they will likely have to cut production levels furthermore or they may even stop the production temporary.