Turkey’s import scrap market has lost pace this week. After earlier deals disclosed to the market, a breather is seemed to be taken. The number of offers in the market is still on the high side, Turkish producers report. Having said that, a standoff is reached. While sellers are still waiting buyers to accept their higher offers, buyers are now trying to keep prices stable with a purpose to reduce them in time.
Also, the US President Donald Trump has announced 25 percent tariffs on foreign steel and aluminum imports on Monday, February 10. This announcement has created uncertainty among international scrap buyers and sellers. The first impact of the announcement is seen as a price rise in the local US steel prices, though it is expected to expand to other regions unless a decision is reached. Turkish mills do not expect much change due to the tariffs in their sales, since Turkish steel had been under a 25 percent tariff in the US under the scope of Section 232 since 2018. Few thinks Turkey may increase its share in the US market. “We shall wait and see. It is too early to say anything concrete. We expect Trump to negotiate with each country separately and what comes out from those negotiations is yet to be seen,” a source at a major Turkish mill commented. Today, February 14, SteelOrbis reported that US President Donald Trump has officially unveiled his plan for reciprocal tariffs against its every trading partner applying tariffs on US goods. Canada, the EU and Brazil are among the countries expected to be affected by these.
Market sources agree that the dynamics of the scrap segment is indicating an upward trend. With the domestic scrap procurement prices moving up in the EU and the US, contributed by a rise recorded in EU-based export yards collection prices, cost of scrap is on the rise. However, the finished steel segment in Turkey is not following suit. “There is a decision to be made. Turkish mills may continue to accept higher prices to replenish their stocks to get ready for the spring and the start of the construction season, or they can take a step back to exert downward pressure on prices,” another source at a major Turkish mill said. A third source reports that “Not only deep sea offers are high in numbers, short sea suppliers are also in the market with several offers”. Several players in the market think that Turkish mills would want to conclude some rebar sales before returning to scrap procurements. “They [Turkish mills] follow a different strategy this time. They are not exerting significant pressure on prices. They saw dropping the quotations quickly is damaging their finished steel pricing. Hence, now they want to be more subdued,” a seller commented. Meanwhile, several sources believe that the economic fundamentals in Turkey will prevent a full recovery in the construction segment this year. There are talks of a price increase for energy prices in Turkey, though no official announcement is made by the authorities.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved up by 0.21 percent week on week. The prices are now 6.66 percent higher month on month in the deep sea segment, with prices being in the range of $353-359.5/mt CFR.
Earlier this week, US domestic scrap prices in the US Northeast and Ohio regions for February settled up $20/gt ($20/mt) and up $35-45/gt versus January values amid reports of continued low inventories and weather-related transportation delays.
March ferrous scrap pricing in the US is expected to settle sideways to higher than recent February settles next month, as inventories are expected to remain low at both mills and suppliers, while new tariff announcements from the Trump administration could further reduce imports of steel and steel scrap at a time when domestic steel production is likely to increase, insiders told SteelOrbis this week. Market insiders told SteelOrbis expectations for lower tariff-inspired steel imports could cause domestic mills to boost production, which will require more scrap. After Trump’s 2018 Section 232 import tariff announcements, domestic mills increased capacity utilization from about 75 percent in March of that year to about 80 percent in September. US capacity utilization averaged about 75.8 percent in 2024, with December estimated at 77.6 percent.
“We’re expecting to see a significant increase in capacity utilization on the part of domestic mills because of tariffs, though the increase could be faster this go-round because of consolidation in the US steel industry since (2018),” one steel market insider told SteelOrbis.
A mill contact confirmed that the outlook seems bullish thus far for March scrap.
“I think expectations are for pricing not to be down, and that there’s a good chance that prices could go up again, though not to the same extent that we saw for February.” the mill contact told SteelOrbis.
This week, local scrap prices in Italy saw a further increase of €5/mt on average because of the lack of raw material available. Moreover, although some mills are still working at a reduced pace, almost all producers are buying.
According to some traders, scrap prices will rise significantly in the coming weeks. Others, however, have more moderate expectations as steel mills, for now, seem adamant that they do not want to grant large increases as they cannot pass on the energy and raw material costs to the finished product.
After last week's rise, the local scrap market in Spain gained another €5/mt. As anticipated last week, the increase in local quotations partially offsets the increase in import prices, with the aim of maintaining a good inflow of raw material.
Local scrap prices in Poland confirmed the upward trend anticipated last week. The low scrap availability, the producers’ need to carry on with the production, the general rising trend in European scrap prices and the short-term reaction to Trump’s tariffs, as well as higher Turkish import scrap prices led to an increase in mills’ purchase prices by €23.5-28/mt. According to sources, HMS I scrap average purchase price stands now at €312/mt delivered to mill.
Export prices, on the other hand, were reported at €310-320/mt DAP, showing an increase of €15-20/mt week-on-week.
In Germany, local scrap prices registered a peak in the past week, following a period of increasing signals. According to sources, the main reasons of these increases are better finished steel demand, the local scrap scarcity, a lower scrap generation from steel consuming companies, the stagnation of the construction sector, and the strongness of the US dollar which makes exports more favorable.
Scrap purchase prices from mills marked an overall increase ranging from €5 to €14.5/mt. Negotiations, though, are still happening.
On the exports side, players in Amsterdam, Rotterdam, Antwerp and Ghent ports are paying around €305-310/mt CIF for HMS I/II 80:20.
After moving up last month, the Kanto scrap export tender in Japan has closed with a price decrease on February 12. The decline on Japanese yen basis was accompanied by a decline of only $3/mt on US dollar basis.
In the Kanto export tender, the highest bid was at JPY 43,200/mt FAS, JPY 1,610/mt lower than last month. The dollar-based price has decreased from $284/mt to $281/mt FAS, taking into account the change in the Japanese yen-US dollar exchange rate. The FAS price translates to JPY 44,200/mt FOB or $287/mt FOB, $3/mt lower than last month, amid the volatility of the Japanese yen-dollar exchange rate.
Tokyo Bay FAS-based prices for H2 grade scrap have also moved down, by JPY 500/mt week on week to JPY 39,500/mt ($257/mt), with a $2/mt fall in the dollar price. This level shows that the FOB price is now at JPY 40,500/mt ($264/mt) for this grade.
The leading Japanese EAF steel producer Tokyo Steel has announced its new prices for its domestic scrap purchases, raising its prices by JPY 500-1,500/mt both for H2 scrap and shindachi grades.
Tokyo Steel’s general range for H2 grade scrap price has moved up by JPY 1,000/mt on the upper end to JPY 39,000-42,000/mt ($254-274/mt) depending on the mill. The dollar-based quotations have increased by $1/mt on the lower end and by $9/mt on the upper end as compared to January 28.
Having made a positive start after the holidays, Taiwan’s import scrap market has continued to move upwards this week. Offers from both the US and Japan have increased week on week, and the appetite of Taiwanese producers is livelier.
Offers for ex-US HMS I/II (80:20) scrap in containers to Taiwan have moved up by $9-15/mt to $314-325/mt CFR over the past week. There are deals closed at $310/mt this week. Offers shared for Japanese H1/2 (50:50) scrap bulk have also increased by $4/mt in this period to $320-327/mt CFR. SteelOrbis hears that there are ex-Japan deals closed at $320/mt CFR Taiwan.
After indicating a slight increase following the Tet holiday, Vietnamese import scrap market have remained stable in terms of offers received from the supplier regions. However, the bids from Vietnamese producers moved up a bit over the past week, raising hopes that trading is recovering.
Offers for Japanese H2 scrap to Vietnam are still in the range of $315-320/mt CFR. Vietnamese buyers’ ideas for workable price levels for this grade is now at around $315s/mt CFR.
Ex-US bulk HMS I/II 80:20 scrap offers to Vietnam have also remained unchanged week on week at $345-350/mt CFR.