This week in Turkey’s import scrap market started with some older deals done late last week being reported, which showed a stabilization of prices and sentiment. Turkey had concluded a high number of scrap deals for December shipment, with new deals showing a sideways tendency, losing their upward momentum. As the current month proceeds, Turkish mills have successfully put the brakes on the uptrend seen in the deep sea scrap market. Market sources believe that the current range of $349-355.5/mt CFR observed for ex-UK/EU and ex-US scrap bookings is workable for all parties. “Both sellers and buyers are happy with this price range,” a source agreed on November 12.
As of today, November 14, a new ex-US deal was shared with the market. The cargo was bought on November 13 by a Marmara-based steel producer with HMS I/II 80:20 scrap at $353.5/mt CFR, and shredded and bonus grades at $373.5/mt CFR. Market sources report that the high tonnage of shredded and bonus grades in the cargo is an unusual composition. Accordingly, a small discount was given to the buyer. SteelOrbis believes that there will be one more ex-US booking at a similar price before the reference prices currently at $355.5/mt CFR are adjusted downwards.
Also, an ex-France deal is rumored to have been done by another Marmara-based producer, closing at $349/mt for 15,000-16,000 mt of HMS I/II 80:20 scrap. While some market players think this cargo can be viewed as a short sea deal, the price is also in line with the current ex-UK/EU scrap prices.
The recent upward trend of deep sea scrap prices was supported by the livelier domestic rebar market in Turkey, which now also supports the current firmness of scrap prices. In the local Turkish rebar market, buyers have restarted moderate restocking and accepted a certain price increase. Some market participants are finding reasons for a certain optimism in the Turkish government’s recently announced intention to build 500,000 social housing units across the 81 provinces of Turkey, which is expected to give some boost to the construction sector. Still, many are skeptical regarding the financing and deadlines for these projects. Over the past week, Turkey’s rebar prices have risen by another $5/mt to $550-560/mt FOB, mainly for December shipments. The Balkan region is still the main export target for a majority of the mills, with a few inquiries lately received particularly from Romania and Bulgaria. A few ex-Turkey rebar offers are available at $550/mt FOB to Bulgaria, SteelOrbis has heard. In the Turkish domestic rebar market, official offers have increased by $10-15/mt over the past week to $560-580/mt ex-works. Moreover, workable levels across Turkey have also improved, by $5-15/mt depending on the region, which is a sign of cautious market support and moderate restocking.
As the flow of ship vessels from the Pacific Ocean to the Atlantic continues after Trump’s decision to postpone the fees for Chinese-built vessels docking at US ports, Turkey continues to find opportunities to buy ex-US West Coast cargoes. Earlier this year, the Trump administration announced plans to impose fees on Chinese-built vessels in an effort to weaken China’s dominance in the global maritime industry and strengthen US shipbuilding. These so-called Section 301 penalties followed a US investigation that concluded that China’s dominance in the global maritime, logistics and shipbuilding sectors was driven by unfair practices. There are not many offers in the market, though all offers still easily find buyers in Turkey as Turkish mills are anticipating the approaching holiday season in the supplier regions during December. Turkey’s deep sea scrap market has started to follow a sideways trend since the beginning of the current week and is expected to continue to do so for now.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved sideways week on week. The prices are now 1.37 percent higher month on month in the deep sea segment, with prices being in the range of $349-355.5/mt CFR.
US ferrous scrap settled prices during November buy-cycle negotiations in the US Ohio Valley and US Northeast finished mostly sideways to October, though Midwest busheling scrap settled down for November as workable trading ranges for that grade tightened amid reports of still abundant local supplies, market insiders told SteelOrbis. And, even though November settled prices were mostly sideways, insiders said the fact that pricing did not continue down across the board, as was seen in October supply negotiations, indicates that a more bullish outlook for US scrap is emerging as more steel production facilities begin to emerge from annual maintenance operations.
The Italian scrap market has undergone some small upward adjustments in prices in the past week. Some steel producers have made minimal changes to their scrap purchase prices to align with market levels, while keeping their price lists unchanged overall. Traders are continuing to report scarce scrap availability - especially for busheling scrap - resulting from the slowdown in sectors such as metal manufacturing and automotive, and said that occasional increases in the range of €5-10/mt have been granted.
Monthly scrap purchase negotiations are coming to an end in the local Polish scrap market, with most mills’ positions remaining unchanged compared to October. Most steel producers have chosen to maintain their scrap purchase prices unchanged compared to last month, except for one of the biggest producers in Poland which has decided to increase them by around €5-8/mt (PLN 21-34/mt). As for exports, the major Polish scrap yards have decided to raise their prices by around €2/mt (PLN 9/mt) and are now paying around €243/mt (PLN 1030/mt) DAP for HMS I scrap.
Most market players have reported unchanged scrap purchase prices in Germany while monthly negotiations are continuing. The market fundamentals have not changed substantially, so there have been almost no variations in scrap prices either. In contrast with what local scrap dealers were hoping in Germany, only one major steel producer in the local market has increased its scrap purchase prices, by €10/mt, whereas the others are reported to have maintained stable prices.
Japan’s latest monthly Kanto scrap export tender was closed on November 11, with a price increase on Japanese yen basis, equal to a $4/mt increase in the dollar-based price. The depreciation of the Japanese yen has contributed to the increased export price. In the Kanto export tender, the highest bid was at JPY 44,960/mt ($294/mt) FAS, JPY 644/mt higher than last month. The total tonnage of the cargo was 20,000 mt, while the purchaser was a Vietnamese mill. The dollar-based price has moved up by $4/mt from last month’s $269/mt FAS, taking into account the changes in the Japanese yen-US dollar exchange rate.
The leading Japanese EAF-based steel producer Tokyo Steel has continued to increase its local scrap purchase prices, with its latest hike coming after the slight increase observed in the Kanto scrap export tender on November 11.
The general price range for H2 grade scrap has increased by JPY 500/mt to JPY 39,000-44,000/mt ($253-285/mt) depending on the mill. The Takamatsu region still represents the lower end of the general range. The Tahara, Okayama, Kyushu and Tokyo Bay plants still represent the upper end of the general price range. Including the changes in the exchange rates, the dollar-based prices have moved up by $6/mt on the lower end and by $3/mt on the upper end as compared to the levels announced on November 1.
Taiwan’s import scrap prices have moved sideways for the second month in a row, with the general range set in a narrow range for months now, despite slight fluctuations. Market sources report that the sluggishness of the domestic rebar and construction segments is the main reason of this steady scrap price trend. “The Taiwanese rebar market seems to be stuck in a dead swamp, with no solution from the government yet,” a source at one Taiwanese mill said. A lawsuit which was filed in September is still ongoing in Taiwan regarding the filling of previously excavated areas on state-owned land with waste soil from various sectors, including construction.
Over the past week, offer prices for ex-US HMS I/II (80:20) scrap in containers have changed from $298/mt CFR to $296-307/mt CFR, indicating a relatively stable trend. Actual deal prices have remained unchanged for this grade at $295/mt CFR.
Offers for Japanese H1/2 (50:50) scrap bulk cargoes are in the range of $315-323/mt CFR. Although the lowest level accepted by sellers is $315/mt CFR, Taiwanese buyers are bidding at $310/mt CFR and below for this grade. No deals have been done by Taiwan this week for Japanese scrap.
While scrap demand in Vietnam remains on the low side as the country is dealing with the aftermath of the typhoons which hit the region in recent weeks, ex-US scrap offers to the country have moved up slightly due to the support found from scrap prices in Turkey. Meanwhile, Japanese scrap prices to Vietnam are relatively stable after the Kanto export tender.
Ex-US bulk HMS I/II 80:20 scrap offers have picked up slightly over the past week, moving from $350/mt CFR to $350-355/mt CFR. Sources report that workable levels are still at around $340/mt CFR. “Due to the gap between offer and bid prices, no deals have been done this week,” a source reported.
Vietnam’s Japanese H2 scrap purchases were closed at $325/mt CFR over the past week, with offers remaining at around $330/mt CFR, unchanged for the third week in a row.
This week, the Tokyo Bay FAS-based prices for H2 grade scrap have remained stable at JPY 43,000/mt ($279/mt), down by $2/mt on dollar basis. The FOB-based export price remains at JPY 44,000/mt ($285/mt) for the grade in question, down by $2/mt week on week.
Bangladesh’s import scrap market has remained largely stable over the past two weeks, with a mild downward tendency. Trading activity has been limited, and participants reported little indication of a recovery, with only sporadic deals taking place. Offers for shredded scrap from EU have remained at $365/mt CFF, while offers for ex-EU HMS I/II 80:20 scrap have been voiced at $340-345/mt CFR levels, down by $5/mt on the lower end of the range. Besides, offers for ex-Australia shredded and HMS I/II 80:20 have been voiced at $365/mt CFR and $345/mt CFR, respectively, mainly the same as two weeks ago. In the bulk segment, offers for ex-US HMS scrap have been voiced at around $350/mt CFR, compared to $350-355/mt CFR two weeks ago. In the meantime, according to sources, last week a deal for ex-US shredded scrap was signed at $350/mt CFR Bangladesh. Besides, another bulk cargo for ex-Australia HMS grade scrap is reported to have been booked by a Bangladeshi steelmaker at $340-345/mt CFR Chattogram. Market insiders expect that Bangladesh’s scrap market will remain muted in the short run, held back by sluggish steel demand, tight liquidity and a slow rebound in construction.