The expectations of Turkish mills and deep sea scrap sellers have differed this week, after a quick round of deals transacted previously. Some mills consider current price levels acceptable for the coming deals, while others believe prices will be corrected downwards. On the other hand, sellers are standing firm in terms of their offer prices. Turkey’s central bank left interest rates stable yesterday, January 20, supporting the Turkish lira against the major currencies. However, natural gas flow from Iran to Turkey has been disrupted due to technical problems, which are expected to take ten days to be resolved. Accordingly, industries in Turkey have been asked to adjust their production rates by the government. Some producers are heard to be taking steps in this direction today, January 21. Under the current circumstances, the deep sea HMS I/II 80:20 scrap price has remained week on week in the range of $460-473/mt CFR Turkey, 2.63 percent higher as compared to the same time last month.
Before January scrap prices settled in the local US scrap market, sources throughout the country believed that mills could try to take prices down again in February, a suspicion that was largely spurred by falling sheet steel prices. This week, however, sentiment has largely improved, and all sources polled said they now believe the market will hold at sideways. In the past several days, large swaths of the central, southern and eastern United states have been hammered by snow and ice.
Having bought A3 scrap from Russia at higher prices as SteelOrbis reported at the beginning of this week, it is observed that South Korean mills have also raised their quotations for alternative sources to secure the scrap tonnages they need. Meanwhile, they continue to push up their domestic scrap prices. As compared to the levels announced on January 13, Hyundai Steel increased its bid for H2 grade by JPY 2,000/mt ($17.5/mt) to JPY 51,000/mt ($446/mt) FOB. The SteelOrbis ex-Japan H2 reference price has increased to JPY 51,000-52,000/mt ($446-455/mt) FOB, with the lower end of the range up by JPY 2,000/mt ($17.5/mt). After staying away from US origin scrap for a while now, Hyundai has bought an ex-US West Coast cargo with HMS I scrap in the range of $522-526/mt CFR, SteelOrbis has learned. Ex-US HMS I/II 80:20 scrap offers to Vietnam were in the range of $520-530/mt CFR on January 14 and there are rumors of a new deal closed at $530/mt CFR this week.
While import scrap prices in Taiwan have moved up over the past week, it is observed that some Taiwanese buyers have been forced to buy from Japan at higher levels and despite the large gap between ex-Japan and ex-US scrap prices. Deals for ex-US HMS I/II 80:20 scrap in containers to Taiwan have been closed at $445-450/mt CFR this week, up from $440/mt CFR in transactions last week. Japan has managed to sell to Taiwan H1/2 50:50 scrap by bulk at $495-500/mt CFR, while offers were at $490-500/mt CFR last week and previous deals were at much lower levels earlier this month.
Aiming to stir up some buying interest among end-users, by the end of the current week Pakistani producers have decided to decrease their rebar prices. Specifically, offer prices have declined by PKR 5,000/mt ($28/mt) compared to the previous levels. Meanwhile, import offers for shredded scrap in containers to Pakistan have remained firm at levels of the previous week, at $550-555/mt CFR, with the lower end of range valid mostly for ex-UK/Europe material, while the high end is valid for ex-US material.
Aiming to secure feedstock, Bangladesh-based scrap buyers have remained highly active in the import scrap market this week. However, customers have been facing certain challenges while searching for cargoes. Rare offers for shredded scrap in containers to Bangladesh have reached $575-580/mt CFR, up $10/mt within the past week.