With ex-US scrap prices declining below $400/mt CFR this week in a new deal, the cautiousness in Turkey’s import scrap market has increased. It is heard that European scrap sellers are willing to start negotiations for $380s/mt CFR, though there are no new deals.
A rumour of an ex-Amsterdam booking by an Iskenderun-based Turkish producer with HMS I/II 80:20 scrap prices standing at $370/mt CFR was confirmed as an additional tonnage to a previous cargo. However, this news signaled that European scrap prices have softened to $380-385/mt CFR, while Turkish mills are still seeking $370s/mt CFR for this origin. A source said, “We may have left levels above $390/mt CFR behind us.”
Sentiment is negative as finished steel demand has not recovered yet. Ahead of the elections to be held on May 14, some traders decided to close their open positions to eliminate risks, though finished steel demand cannot be described as lively. The Turkish steel market with its business partners will be in Barcelona for the SteelOrbis Spring 2023 Conference & 88th IREPAS Meeting to be held on May 7-9. Several market players from both the seller and buyer segments think the market situation will be clearer before the conference ends.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap in CFR terms has decreased by 4.61 percent week on week. The prices are now 10.47 percent lower month on month in the deep sea segment, with prices in the range of $390-397/mt CFR.
Sources close to SteelOrbis have confirmed that in the US market one Detroit-based mill has come out at down $20/gt for primes and down $30/gt for shredded and P&S, which is more favorable than what was suspected last week, when some speculated the market could come down by $50-70/gt depending on the region and the grade. Mills in other regions have yet to announce prices, and it is widely suspected that scrap prices in the Midwest, Northeast, and Southeast may not fare as well.
SteelOrbis has learned that the current price for Mexican domestic shredded scrap is still at MXN 10,100/mt ($546/mt), the same level in pesos as on April 24. Additionally, HMS I/II scrap prices are being heard at MXN 8,650/mt ($468/mt), also unchanged from April 24.
The local Italian scrap market has moved down over the past two weeks. Market players state that the mood in the market is negative and several sources expect a further decline in prices. While European steel producers have maintained a wait-and-see stance to monitor the trend of the international scrap market, they also add that finished steel demand is not in good shape.
Taiwan’s import scrap market has continued to move down in the current week, but market players report that both US and Japanese sellers are taking a step back because they consider the current levels to be too low. While deals for ex-US HMS I/II 80:20 scrap in containers to Taiwan were at $355-360/mt CFR, the lowest offer levels for Japanese H1/2 50:50 scrap by bulk to Taiwan are now at $375-380/mt CFR.
In Bangladesh, trade activity in the import scrap segment has remained at minimal levels this week given continuous problems with opening letters of credit (LCs). Thus, only occasional deals have been reported this week. Besides, given the continuing decrease in import scrap prices, most buyers have been awaiting more declines in the short run. In particular, offers prices for ex-UK shredded scrap in containers in Bangladesh have been voiced at $455-465/mt CFR, versus $470/mt two weeks ago. Besides, offers for ex-UK HMS I/II 80:20 scrap have been heard at $430/mt CFR, while customers’ bids have been voiced at $420/mt CFR levels. At the same time, a deal for ex-Australia HMS grade scrap for around 2,000 mt has been reported at $425/mt CFR this week. Furthermore, another deal for ex-UK PNS scrap has been signed at $470/mt CFR this week, while ex-Hong Kong PNS offers have dropped to $465/mt CFR. In the bulk segment, offers for ex-US HMS grade scrap have been voiced at $430-435/mt CFR, versus $460/mt CFR two weeks ago. However, no deals have been reported so far.
In Pakistan, import scrap prices have continued to decrease this week, with a few deals reported at lower levels. Following some deals for around 4,000 mt in total of ex-UK shredded scrap in containers signed at $455/mt CFR at the end of last week, a fresh deal for around 1,000 mt of ex-UK materials has been reported at $445/mt CFR this week. Meanwhile, by the middle of the week fresh offers for UK origin shredded scrap have dropped to $440/mt CFR, indicating a $15-20/mt fall week on week. According to sources, the Pakistani scrap market has continued to face extremely the low capacity utilization rates of longs steel manufacturers, coupled with still weak finished steel sales and slow construction activities in Pakistan given the lengthy holidays in the country.