After increasing slightly, Turkey’s ex-Baltic scrap quotations have failed to maintain their strength, creating doubts about the recent rise. The very slow trading in the Turkish steel industry is an obstacle, not providing room for Turkish mills to accept higher scrap prices.
A new ex-Baltic booking done by an Iskenderun-based producer in Turkey was closed at $340/mt CFR for HSM I/II 80:20 scrap for late August shipment. This price is $4/mt lower than the previous ex-Baltic price for this grade, reflecting inconsistency amongst Baltic sellers. For now, SteelOrbis has revised its ex-Baltic scrap quotations to $340-344/mt CFR.
Market sources report that the bids received from Turkish mills for scrap cargoes are moving down once again. The stagnation in the local Turkish market is a big factor, preventing an increase in rebar prices, which ends up limiting the upward movement in the scrap segment. The local European scrap market has moved down this week, as SteelOrbis reported in its previous report, by an average of €10-13/mt. Germany-based sources report that scrap demand is slowing down sharply as mills are getting ready for the summer holidays, adding that scrap demand from export yards is also not great. “Prices in the EU are on the low side and now procurement tonnages will decline during the European holidays. It makes no sense for Turkey to accept higher levels at this point,” a Germany-based sub-collector said. While the local US scrap market has settled sideways in July, the first indications coming out the US signal a possible increase in scrap availability. Some sources report that scrap demand in the local US market is failing to consume all supply for now, though it is too early to make an assumption for August settlement prices. Meanwhile, sources at Turkish mills report that the number of available cargoes offered is not high. This, together with the low appetite of Turkish mills, creates a balance in the market for now, and a sharp decline in price is considered to be unlikely. “We may see another sideways trend in the coming days. It would not be a surprise as rebar demand is failing to recover even at lower prices,” a source commented.