Following the ex-US and ex-Baltic deals indicating a sharp price increase in the beginning of the current week, an ex-EU scrap booking was closed at higher levels.
An Iskenderun-based mill has concluded the ex-German transaction for 21,000 mt of HMS I/II 75:25 scrap, 7,000 mt of bonus grade scrap, 2,000 mt of busheling scrap at the average price level of $303/mt CFR. The cargo will be shipped late January. The HMS I/II 80:20 of Europe origin is estimated to be at $303/mt CFR Turkey, according to this information. Previous to this booking, recent deals have been closed at $290-293/mt CFR, for European origin benchmark grade scrap prices.
The surge in the deep sea scrap prices is the result of mills’ heavy demand. Although further disruptions in the supply side are expected amid the measures and lockdowns in the European market, sources state that the decrease is currently not much higher than the initial forecast. Meanwhile, freight numbers are increasing in Europe. Also, finished steel exports from Turkey are supporting the scrap market as mills are not under pressure to cut their semi and finished steel export prices in the short term, instead trying to increase quotations. The demand received from Far East is the main supporter of the international finished steel markets as well as the scrap prices. As suppliers have taken a step back to evaluate the situation and see a clearer picture regarding their costs, deep sea scrap prices are expected to continue rising. Some market players state that there were firm bids from mills for prime grade scrap up to $315/mt CFR Turkey and have room to increase further in the coming period, though no booking has been concluded at those levels yet.