With an ex-US deal disclosed to the market today, December 10, deep sea benchmark HMS I/II 80:20 scrap prices have signaled a stabilization after the sharp decrease recorded earlier this week.
SteelOrbis has learned that a Marmara-based producer has bought the cargo in question from the US. The cargo consists of 22,000/mt CFR and 8,000 mt of shredded and was priced at the average level of $476/mt CFR. It will be shipped in January. The benchmark HMS I/II 80:20 scrap quotation is estimated to be around $470-471/mt CFR with premiums at $20/mt, though there are rumors of a lower gap between grades at $15/mt which would result in $472.5/mt CFR for HMS I/II 80:20. The premium paid for the higher grades has not been confirmed by either party. Prior to this deal, SteelOrbis’ estimations for US origin HMS I/II 80:20 scrap was at $470/mt CFR.
Turkish mills’ efforts for lower prices seem to have failed, as some European sellers are stating that they cannot accept bids at $455/mt CFR due to their collection costs. As mentioned earlier this week, collection costs in the EU are around €350-355/mt, not leaving much space for a cut. Meanwhile, with US sellers not bending under the pressure and concluding a deal at $470-471/mt CFR, Turkey has received positive reactions, interpreted as a sign of stabilization.
A similar sentiment is observed in the short sea segment. Following the significant decrease recorded at the beginning of the current week, HMS I/II 80:20 scrap prices from Romania and the Adriatic region are still standing at $440-445/mt CFR. Meanwhile, according to sellers from Israel and Cyprus, HMS I/II 75:25 scrap prices are stronger, with the last deal closed at $445/mt CIF Iskenderun, and sellers are not willing to cut their offers under this level. “$460/mt CFR for deep sea HMS I/II 80:20 is the bottom level, and so there is no need to be aggressive with our offers right now,” a seller commented.
Also, trade in the local Turkish rebar market has been better recently. Some rebar has changed hands at $700/mt ex-works, mainly after some Izmir-based mills cut their prices to this level following Kardemir’s domestic sales. As of today, $700/mt ex-works is not considered widely workable as Turkish producers once again increased their domestic quotations to $710/mt ex-works for actual sales with higher tonnages since the Turkish lira has depreciated further against the major currencies.
