The emergence of a report of an ex-US scrap booking has caused some confusion in Turkey’s import scrap market since late on December 18. While the scrap grades in the cargo were subsequently revised, market sources are not sure whether this deal will have a determining impact in the coming round of sales.
SteelOrbis has learned that the ex-US transaction done yesterday, December 18, by an Izmir-based steel producer was closed for HMS I/II 85:15 scrap at $369.5/mt CFR, shredded and bonus grade scrap prices at $389.5/mt CFR. The first impression was that $369.5/mt CFR price was paid for the HMS I/II 80:20 scrap, but this was denied by the buyer. While the final information indicates the benchmark HM SI/II 80:20 scrap price at $366-367/mt CFR, the higher grades indicate that the ex-US HMS I/II 80:20 scrap price remains at $369.5/mt CFR. As a result, SteelOrbis will revise its reference price for ex-US material to $366-369.5/mt CFR, reducing it by a mere $0.25/mt on average.
The same producer has concluded another cargo from Germany with HMS I/II 80:20 scrap at $361.5/mt CFR, merely $1/mt higher than the average ex-UK/EU scrap price. SteelOrbis has kept its ex-UK/EU reference price stable for now.
In Turkey’s import scrap market, both buyers and sellers continue to hold their ground. Buyers citing their slower finished steel sales are aiming for lower scrap price levels, and have succeeded in closing some deals. On the other hand, some sellers - due to their expectations of a higher price level in January, especially in their local markets - believe it is not time to give ground on their scrap prices. SteelOrbis has learned that most ex-US scrap suppliers are unwilling to cut their prices below $370/mt CFR, while the workable level after negotiations would be at around $367-368/mt CFR. US-based suppliers expect their local market to move up by $20-30/mt during the January buy-cycle, adding that the cold weather conditions would disrupt scrap flow further in the coming month when they return from the holidays. In the EU, scrap collection prices for exporters remain in the range of €265-270/mt DAP, while the exchange rate at €1.17 to the dollar is also supporting tCFR Turkey-based prices. “We have reservations regarding Turkish mills’ finished steel prices and sales but we also have little to no room to cut our prices to their desired levels,” a European scrap seller said. A Turkish mill also mentioned that this week was easier for them but as of next week scrap suppliers may maintain a firmer stance in terms of their offers to Turkey. As a result, despite the initial confusion in the market, SteelOrbis believes deep sea scrap prices have managed to move sideways with the latest deals.
