With eerily similar trends to 2008, CFR prices of ex-US material witnessed a significant rise over the past two weeks with several cargos booked at rates up nearly $60.
Turkish producers have returned to the US market, accepting substantially higher prices than those offered just a few weeks ago. As of March 12, the transaction price of HMS I/II 80:20 was about $390/mt CFR Turkey, today the same material is going for $450/mt CFR, representing a $60 /mt increase. Strong sales to Turkey coupled with higher demand from US steel producers are boosting domestic prices as well. At this point the best estimates for April prices will be on average $40 /mt over those seen in March.
Unlike the increase in activity from US East Coast ports to Turkey, Gulf and West Coast exporters have seen a drop off in inquires from their Far East customers. Prior to recent days, Taiwanese producers had maintained a healthy appetite of ex-US scrap with steady transactions at rates last heard at $380-$390/mt for containerized CFR HMS I/II 80:20. However, as of late no substantial transactions have been heard. Industry sources sight that local Taiwanese yards unloaded inventory as there was a feeling that domestic pricing would retreat, thus providing Taiwanese producers with satisfactory inventory levels for the time being. At the same time, Korean producers have also slowed their buying activity with lower price ideas of $410-$415/mt CFR containerized HMS I/II 80:20, up $5/mt from last week. According to some, these offers are considered to be too low to see any substantial material moving at the current level (what was the old level?). China, last year's top importer of ex-US scrap, has yet to be heard from in any way of major transaction activity.
The overall feeling in the US scrap market is one of instinctual cautiousness and reserved practices as steep price increases continue and the disaster of 2008 looms in the rearview.