While domestic scrap quotations in Germany and Poland have indicated a slight increase during July and met the initial expectations, SteelOrbis understands that the trend is set to a decrease for August.
It is observed that the positive gains recorded in the local German scrap market at the beginning of second half of the month are now lost. Additionally, some market players pointed out that the demand in local European scrap market, that provided support also for the Germany, has started to slow down. A France-based scrap seller seconds the slower demand in the EU and adds that under the current situation, suppliers may return to selling export markets such as Turkey.
Major negative weather events in Germany have also impacted the logistics in the country. According to sources, the efforts to sweep the waste material resulting from the floods around the country is taking time. As a result, there is lack of containers in Germany as well as lack of trucks and manpower. Also market players in Germany state that the scrap inventories are on the high side, particularly for HMS I/II grades that are not traditionally used by German producers. A source states that “these grades will compulsorily go to the export markets.” However, some grades such as bonus materials are still sought by European mills, SteelOrbis understands.
There are also further concerns about the fourth wave of the Covid spread in the EU. “Vaccinated population is still on the low side in Germany”, sources state, “there can be another lockdown after the holiday season.” A sharp decline in local German scrap market is expected during August. Some sources go as far as to say they definitely expect a fall in prices in the coming month.
According to the latest data provided by the BDSV, in the first 20 days of July, local scrap prices increased by €3.5-25.9/mt month on month. On the other hand, the annual increase is much larger and is in the range of €176.8-221.1/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).
|
Scrap grade |
Price: July 2021(€/mt) |
Price: June 2021(€/mt) |
Price: July 2020 (€/mt) |
Monthly Change (€/mt) |
Annual change (€/mt) |
|
E1 - Old steel scrap |
379 |
375.5 |
202.2 |
3.5 |
176.8 |
|
E2/E8 - New steel scrap |
456.3 |
430.4 |
235.2 |
25.9 |
221.1 |
|
E3 - Heavy old steel scrap |
424.4 |
416 |
231.1 |
8.4 |
193.3 |
|
E40 - Shredded scrap |
432.7 |
426.5 |
236.2 |
6.2 |
196.5 |
|
E5M - Steel turnings |
370.3 |
361 |
183.6 |
9.3 |
186.7 |
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
Meanwhile, prices in the local Polish market for HMS I scrap are at around $520/mt DAP. Amid the holiday season in the country, scrap market is very quiet, but this situation is interpreted as a “typical holiday season.” As some producers have taken holiday breaks, new scrap flow is not strong, though old scrap is still there. Prices in the local Polish market is expected to move down by at least €10-15/mt in August.