As Turkish mills continue to buy deep sea scrap cargoes and accept to pay higher levels with each deal, ex-US HMS I/II 80:20 scrap has reached $360/mt CFR. Scrap exporters’ offers to Turkey continue to rise, while demand is still observed for December and January shipments.
SteelOrbis has learned that an Izmir-based mill has concluded a transaction for HMS I/II 80:20 scrap at $360/mt CFR, with shredded and bonus grades priced at $380/mt CFR, for December shipment. Prior to this deal, ex-US HMS I/II 80:20 scrap prices were estimated at $350-355/mt CFR.
Another deal, from France, has been disclosed to the market today, November 28, but was done on Wednesday last week with HMS I/II 80:20 scrap at $345/mt CFR and shredded scrap at $363/mt CFR. The total tonnage of the cargo is 25,000 mt and it will be shipped in the first half of January. Since the cargo was sold in the middle of last week, the price is now considered irrelevant and ex-EU scrap prices have been revised to $350-355/mt CFR.
SteelOrbis hears that scrap demand from Turkish mills continues to be observed this week, with sellers offering at higher levels after each deal. “No one from the US will offer $360s/mt CFR right now, they will try for higher levels,” a seller commented. Another seller disagreed, stating that, with each price increase, the losses of Turkish mills deepen, adding, “I think there will be some sellers willing to close some bookings to Turkey in the range of $350-355/mt CFR from the EU.” The same seller indicated that higher than $360-365/mt CFR Turkey for benchmark HMS I/II 80:20 scrap could be risky for Turkish mills. The collection prices in Netherlands are reported to be at €310s/mt DAP, which signals higher than $360s/mt CFR Turkey. While Turkish mills have covered most of their needs for December shipment with their recent bookings, market players point out that Turkish producers still need cargoes for January shipments. “Some of the mills have started to book or seek scrap for January shipments and the others should follow in the coming days, while allocation is still on the low side,” one market player commented, adding, “I expect European scrap collectors to take a step back earlier this year. I think they will leave the market for the holidays around December 10 and then will be back after Orthodox Christmas which ends around January 10. This may cause tighter scrap supply in the coming weeks.” The idea is that each deep sea offer and deal to Turkey should be judged on its own merits from now on, depending on the sellers’ and buyers’ positions, though there is significant upward pressure on deep sea scrap prices.
There was an ex-Romania deal done late Friday, November 25, for HMS I/II 80:20 scrap at $334/mt CFR, while ex-Bulgaria HMS I/II 80:20 scrap prices are at $330s/mt CFR. However, sellers are expected to increase their offers to Turkey due to their expectations of continuing demand.
