While SteelOrbis had previously reported a lot of deal news from the Turkish scrap market, the market has this week seen a return to inactivity. Although the Turkish producers have managed to replenish their stock levels to a certain degree thanks to the deals concluded in recent weeks, they have not been very pleased with the situation in the finished product markets. It is also observed that demand from the finished steel markets, except in Iraq and North Africa, has not yet awakened, and, in addition, the local finished steel market in Turkey appears fairly calm at the moment. Due to this situation as regards finished steel demand, Turkish producers have decided to take a break from purchasing scrap for the moment. Thus, they have been unable to reflect the increased scrap prices in their prices for finished steel products.
It is observed that demand for scrap in Italy has declined considerably on account of the serious production cutbacks in the local market. Although it is really hard to give a definite price level for this market, it is heard that scrap suppliers have lost most of their advantage in negotiations with the scrap buyers, who are few and far between. In the Turkish market, ex-Europe scrap prices have this week declined significantly from the price levels seen in deals two weeks ago (i.e. $278-280/mt CFR Turkey for HMS I/II 70:30). Turkish buyers have said that, if they were interested in buying, it would be possible to see HMS I/II 70:30 at a price level of around $255/mt this week.
The price levels of ex-US HMS I/II 80:20 are now observed to be on a downtrend in line with the general price trend. Taking into account that definite offers are not heard, it is said that Turkish producers could buy HMS I/II 80:20 scrap at around $275/mt CFR Turkey, compared to $285/mt CFR for concluded deals two weeks ago.
As prices on the Black Sea side are still at high levels, it has become more difficult to compete with scrap prices in other regions. A3 price levels ($300/mt CFR for ex-Rostov and $275/mt CFR for ex-Romania) will with difficulty gain acceptance in Turkey, in which there are currently but few buyers.
Moreover, it is really difficult to mention a current price level in the global scrap markets, where demand levels are fairly weak at present. In the absence of buyers, all mentioned price levels tend to lose their meaning. In these days of poor stability in both the finished product and scrap markets, it is observed that Turkish producers are pursuing short-term strategies and are refraining from stocking large amounts of scrap.