How will Turkish scrap market be impacted by Chinese mills’ price hike attempt?

Starting the new week, the Turkish import scrap market has heard news of successive deals, with many of them concluded in the past week. Accordingly, ex-Europe HMS I/II 75:25 scrap bookings have been concluded at $325-328/mt CFR, $3-5/mt lower as compared to the previous levels recorded one week earlier. Meanwhile, ex-US deals in Turkey for HMS I/II 80:20 scrap have been transacted at $335/mt CFR, indicating a decline of $6-7/mt as compared to the previous transaction levels recorded one week earlier.
 
Meanwhile, global iron ore prices, which had been on a downtrend since early July, have seen a rebound early this week, increasing by $3/mt against the backdrop of the announcement by the Chinese government of support for the domestic real estate sector. In this context, it is heard that Chinese steelmakers are seeking to hike their export prices thanks to support received from the sudden increases in iron ore quotations. Even though this development appears favorable for Turkish producers, it will still be difficult for Turkish exporters to compete with their Chinese rivals in the international markets even in the event of higher ex-China offers. Thus, if Turkish mills fail to receive good demand on the export side, they will likely keep asking for lower import scrap prices. Accordingly, the general consensus for the future price trend for import scrap in Turkey points to a softening tendency. In the meantime, since some Turkish steelmakers still need scrap, there will be new import scrap bookings in the coming days and it is thought that Turkish scrap buyers will try to book scrap at lower levels.