Two ex-US scrap deals have been disclosed to Turkey’s import scrap market today, January 26, both concluded at the end of last week.
SteelOrbis has learned that an Iskenderun-based mill bought one of the cargoes consisting of 20,000 mt of HMS I/II 80:20 scrap at $470/mt CFR and 12,000 mt of shredded scrap at $490/mt CFR, for February shipment.
Also, a producer in Izmir concluded an ex-US scrap deal for HMS I/II 80:20 scrap at $472/mt CFR, shredded scrap at $492/mt CFR and bonus grade scrap at $492/mt CFR. This cargo will also be shipped in February. Prior to these deals, SteelOrbis’ estimation for the ex-US benchmark scrap price was at $470/mt CFR and it will be revised upwards.
Workable levels for ex-US HMS I/II 80:20 scrap are considered to be in the range of $472-473/mt CFR by suppliers. For ex-Baltic HMS I/II 80:20 scrap, sellers are asking for $475/mt CFR, but workable levels are heard to be at $470-473/mt CFR by market players. Accordingly, acceptable levels for ex-EU HMS I/II 80:20 scrap stand at $463-465/mt CFR, SteelOrbis understands.
“Having experienced difficulties in its finished steel sales, Turkey has passed on the opportunity to increase its scrap inventory levels over past months,” a supplier stated, adding, “This may cause an increase in prices for March shipments.” Several suppliers have stated that not many cargoes are available any longer for February shipment. “The positive expectations for the Chinese market after the Chinese New Year holiday and the Winter Olympics are supporting the market,” another source reported, further commenting, “Also, coal and iron ore quotations are on the rise, supporting sentiment.”
The timing of production halts in Turkey is considered to be a good development by some market intermediates. One of these players stated, “Demand for finished steel was slow. These halts will ease the supply pressure in the finished steel market.” Two market players shared the view that this production cut will lead to postponed demand for scrap in Turkey. Having said that, all players agree that Turkey needs some support from the export markets or it will fail to maintain its utilization rates in the coming period. Also, the electricity shortage in the country could possibly drag on and change the sentiment for the short term. One trader stated, “Traditionally, demand for rebar in the eastern local market starts at the beginning of February. We expect the same this year.”
Meanwhile, a Romanian cargo with HMS I/II 80:20 scrap was sold to Izmir at $454/mt CFR earlier this week. Adverse weather conditions are negatively impacting shipments and supply in the short sea segment, while demand is not so strong. “Sellers are mostly trying to meet their shipment and delivery commitments,” a source reported. The downward pressure on the short sea scrap segment continues, though, whether sellers will accept decreases remains to be seen. Sellers’ ideas for HMS I/II 75:25 scrap from Israel stand at $435/mt CIF Iskenderun. A cargo from Libya was sold to Turkey late last week, with HMS I/II 80:20 scrap standing at $452/mt CFR. The seller is seeking higher prices this week and its offers will be around $460/mt CFR.