Several deals surfaced in Turkey’s import scrap market on October 21, though they were mostly done last week. With these deals, Turkey’s deep sea scrap purchases for November shipment were almost completed, if not already completed, while prices indicated a slight increase. Demand and supply are balanced in the market, with neither buyers nor sellers in a rush to do deals.
Late in the week, more older cargoes have been shared with the market. An ex-St. Petersburg cargo closed at $348/mt CFR by a Marmara-based Turkish steel producer was understood to have been done late last week. However, an ex-Estonia deal signed by an Izmir-based producer was done on Wednesday, October 22, with HMS I/II 80:20 scrap at $348/mt CFR, causing no change for SteelOrbis’ reference price for ex-Baltic benchmark scrap at an average of $348/mt CFR.
“I think we are done with November, we can expect a slower market for at least ten days. There are no stressed cargoes left. There are no buyers in a rush,” a European scrap seller said. Another source in Europe commented, “Yes, Turkey has concluded a lot of deals and is very relaxed for the rest of its November shipments. But there is also a balance in the market. Despite the low number of available cargoes in the market, every seller offering a cargo managed to sell it very quickly without a decline in price. I believe this shows that deep sea scrap prices are firm.” “If freight softens, it can give an edge to sellers, but we do not expect a quick change in that regard. We anticipate a gradual decline eventually,” a source added. Turkish mills may show more interest in short sea scrap cargoes in the coming days to secure their inventories. It is known that they are working with short stock periods. Some sources think that, with each new finished steel order Turkish mills receive, they will need to secure more scrap. Turkey’s import scrap market is expected to remain firm in the short term unless a change in collection costs or freight rates is seen. Having said that, the upper end of the price range representing ex-US bookings is considered to be soft by several market players, who pointed out that $353/mt CFR has not been repeated yet. “A small downward correction seems possible for the coming days as Turkey’s appetite is satisfied for the short term and there is room for buyers to wait before starting to buy cargoes for December shipment. While the sellers’ side is also quiet, we know that there will be available cargoes. I do not see any availability problems in the scrap supplier regions,” a supplier of ex-US and ex-EU scrap commented today, October 24.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved up by 0.29 percent week on week. The prices are now 5.37 percent higher month on month in the deep sea segment, with quotations being in the range of $344-353/mt CFR.
US scrap pricing for November remained unchanged this week at sideways to recent lower October settlement prices, as continuing mill maintenance operations are expected to further cull demand for scrap next month, scrap insiders told SteelOrbis this week.
And while finished steel demand remains unremarkable as the US and global economies struggle with tariffs and limited growth, insiders said scrap flows into US Midwest and East Coast supply yards remain brisk, with inventory levels said to be adequate for now.
“There’s very little talk right now about November scrap,” said one mill-based scrap insider, adding, “but it’s feeling very sideways.” “I’ve heard quiet markets, and a sideways month [for November],” said another Midwest scrap insider. “I’ve got nothing new this week on the November outlook,” said still another New York State-based scrap supplier. “Nothing’s being talked about just yet for November, so I’d say sideways,” said a final Midwest scrap insider.
Based on a current sideways to October settlement, US Midwest prime busheling scrap -which settled on average $20/gt less during October negotiations - could settle for November in the US Ohio Valley at $395-420/gt ($401-427/mt) on delivered basis, while shredded scrap, which saw a recent $10/gt monthly decline, could settle sideways near $365-370/gt ($371-376/mt), delivered. Ohio Valley HMS grades which moved $10/gt lower in October, could trade flat near $315-335/gt ($320-340/mt), while P&S scrap, which settled on average also $10/gt less in US domestic Midwest markets, could trade for November near $351-361/gt ($357-367/mt).
The Italian scrap market seems to have reached stability in this third week of October. Demand from mills continues at regular volumes, although plants’ capacity utilization rates remain stable at around 70 percent. As for scrap availability in the market, several sources still report an overall shortage of material, which is why some of them believe that price declines - at least for the current month - have bottomed out.
No significant developments have been reported to SteelOrbis this week in the local Polish scrap market. Monthly scrap purchase negotiations have ended, while there have been few changes in the fundamentals of the European market. Meanwhile, in the export market, HMS I scrap from Polish export yards have remained more or less stable in a range of €242-247/mt DAP this week.
October has been a very quiet month for the local German scrap market, while scrap price declines have been greater than initially anticipated by SteelOrbis, according to BSDV’s monthly report. Official data from BDSV show that ex-warehouse E1 reference scrap prices have been declining for the fourth month in a row, and they have now lost slightly more than €40/mt since January. E1 prices have settled at 220.3/mt ex-warehouse for October.
On October 20, the leading Japanese EAF-based steel producer Tokyo Steel announced the fourth increase in its domestic scrap purchase prices since the beginning of the month, impacting the prices of other steel producers and supporting price increases in the local scrap market. Despite the rises announced, the general range has remained stable on the upper end, with H2 grade scrap prices settling at JPY 38,000-43,000/mt ($252-285/mt) depending on the mill.
Additionally, today, Tokyo Steel has announced that it is starting to buy shindachi scrap for its Tokyo Bay plant, with the upper end of Tokyo Steel’s shindachi scrap prices increasing by JPY 2,000/mt to JPY 39,000-47,000/mt ($254-307 /mt) delivered.
Taiwan’s import scrap prices have followed a soft sideways trend this week. While ex-US scrap prices have lost some slight strength, Japanese suppliers are once again out of the market. Taiwan has been hit by a typhoon this week and it has been raining heavily.
Over the past week, the offer prices for ex-US HMS I/II (80:20) scrap in containers have remained relatively stable, changing from $300-302/mt CFR to $299-305/mt CFR.
Offers for Japanese H1/2 (50:50) scrap bulk cargoes are still absent this week, like last week. The most recent offer from Japan to Taiwan was heard two weeks ago at $315/mt CFR.
Vietnam’s import scrap market has remained relatively stable this week, though the heavy rains and typhoon weather in the country have been taking their toll on construction activities as well as on steel demand.
Following the ex-Japan H2 grade scrap sales to Vietnam closed at $325/mt CFR last week, offers are still at around $327-330/mt CFR. Ex-US bulk HMS I/II 80:20 scrap offers have moved sideways at $350/mt CFR Vietnam.
Market sources report that local Japanese scrap prices have increased this week after Tokyo Steel’s announcements of a rise in its domestic scrap purchase prices. This week, the Tokyo Bay FAS-based prices for H2 grade scrap have increased by JPY 500/mt week on week to JPY 41,500/mt ($271/mt), up by $2/mt on dollar basis. The FOB-based export price remains at JPY 42,500/mt ($278/mt) for the grade in question, stable week on week.