Two ex-US scrap deals have been heard in Turkey’s import scrap market, both with lower price levels for HMS I/II 80:20 scrap. It was already known that several US-based suppliers were in the market seeking opportunities at the end of last week, but after Turkish mills asked for lower quotations, SteelOrbis observes that most of them are now out of the market, mainly waiting to hear from buyers instead of offering aggressively.
An Izmir-based mill has concluded the first ex-US booking for 30,000 mt of HMS I/II 80:20 scrap at $360/mt CFR and 15,000 mt of shredded scrap at $375/mt CFR. The cargo is believed to be done at the end of last week. Previous to this deal, the estimations for ex-US HMS I/II 80:20 scrap was at $375-377/mt CFR.
Another rumour of an ex-US scrap cargo sold to a Marmara based mill is for HMS I/II 90:10 scrap priced $365/mt CFR. However, this deal has been rejected by the parties. Nevertheless, most market players think that it is done.
“Since there is little time left for August shipments, the price may remain in the range of $350-360/mt CFR until Turkish mills complete buying the remaining ten cargoes for August,” a seller commented. “Today, there is almost no offers from the Baltic or the EU, but workable level can be considered at around $350/mt CFR,” another seller commented. As the abovementioned US cargoes are still there, market players are waiting to see what US-based sellers will decide. According to a market player, some Turkish mills have started to ask for $320-330/mt CFR for deep sea HMS I/II 80:20 scrap. “How many US suppliers will be willing to sell is the main question, their local scrap market will settle next week,” a European seller commented. Although the expectations for the local US scrap market is mixed, market players stated that “the scrap volume bought by the US-based mills is another factor to take into consideration.” Domestic mills in the US have not been buying [a lot of scrap], export has been lagging, and there’s still an oversupply of scrap. On the other side, there are some factors that are slowing down the scrap flow in the EU and the US. The heat wave over the EU is taking its toll as reported previously by SteelOrbis, as well as the summer lull. Also, a similar situation is observed in the US. “Lower water levels in the EU is negatively impacting the volumes carried over the rivers and causing freight to increase accordingly,” a Europe-based seller reported. Additionally, it has been heard that there are some problems regarding the transportation by train and trucks in the US. Having said that, the expectations for September shipments are closer to $300/mt CFR, some even voicing lower than $300s/mt CFR, citing pessimistic macroeconomic outlook. According to a market player, “There is nothing to support the production, demand or the price levels in the medium term. If nothing changes, Turkey will get into the election mood late this year and domestic trading traditionally slows when election approaches.” Another one mainly agrees the idea, “I am very pessimistic about the future trend of the scrap quotations, look at Hong Kong, even below $600/mt CFR for rebar is now debatable.”
On the short sea segment, suppliers of Romanian and Adriatic scrap state that there is little demand, high pressure on prices as few bids are received at “for-now” unacceptable levels and sellers want to wait for deep sea scrap prices to settle first. Expectations for this grade is at $300-330/mt CFR, though no new deals have been done in this range yet. Due to the lack of new sales, SteelOrbis’ reference prices for this grade is adjusted to $330-340/mt CFR from the levels of $345-350/mt CFR.