German and Polish scrap markets move up as anticipated

As anticipated, prices in the local German scrap market have moved up in November amid the lively demand from German mills. Despite the price increases recorded in the market, SteelOrbis has learned that some producers have failed to procure their needs, and so they have decided to increase their purchase prices further in the last ten days of the month. The impact of the winter is stronger according to some market players, while one stated, “Water levels in German rivers have once again decreased, and so ships are loaded with lower tonnages as freights are increasing”. Some smaller suppliers have decided to stop their sales ahead of the holiday season in order to avoid paying higher taxes. Also, due to the colder weather conditions, collection activities are slowing, a source stated, commenting, “Scrap flow is significantly low.” “As the inventories on hand are already committed, future collection will only be enough for local production,” another player reported. As a result, local scrap prices in Germany are expected to continue their uptrend in December.

According to the latest data provided by the BDSV, in the first 20 days of November local scrap prices moved up by €14-37.6/mt month on month. Additionally, the annual increase is still significant in the range of €134-240/mt. Prices are average prices for domestic transactions across Germany in the first 20 days of the given month. The prices are provided by Bundesvereinigung Deutscher Stahlrecycling-und Entsorgungsunternehmen e.V. (BDSV).

Specifications:
E1 - Old steel scrap: thickness ≥ 4 mm, maximum dimensions 1.5 m x 0.5 m x 0.5 m
E2/E8 - New steel scrap: maximum dimensions 1.5 m x 0.5 m x 0.5 m
E3 - Heavy old steel scrap: thickness ≥ 6 mm, maximum dimensions 1.5 m x 0.5 m x 0.5 m
E40 - Shredded scrap: excluding incinerator steel scrap and collection scrap; density ≥ 1.1 mt/m3, Fe ≥ 92%
E5M - Turnings: excluding iron and automatic steel turnings

During the past month, prices in the local Polish market for HMS I scrap have increased by €37-47/mt from the range of €373/mt DAP to €410-420/mt DAP. As the lack of new scrap, bonus and busheling grade supply continues in Poland, prices are expected to move up further in December, also due to the slowing collection activities in winter. “Producers will try to replenish their inventory levels for scrap ahead of the holiday season. This will have a positive impact on prices,” a source commented. Market players state that local demand for finished steel is also slower but that mills’ inventory levels are not high, and so a balance is observed in the market.