Local German scrap market hit by disruption in logistics, prices increase

Tuesday, 23 August 2022 16:39:19 (GMT+3)   |   Istanbul
       

Over the past month, prices in the local German scrap market have increased in contrary to the previous expectations. At the beginning of the month, market intermediates anticipated a sideways movement at best, but mainly a decline in quotations because of the holiday in the EU region. But the water levels on German rivers declined sharply due to hot weather conditions and drought. As scrap collection activities slowed down, ready inventories cannot be moved around as easy as in the past, local scrap prices in Germany has remained stable in the first half of August, but then started to move up against the backdrop of supply declining below demand.

Since the problems regarding logistics remain unchanged, the supply flow to mills or export yards is not expected to accelerate in the short term. It is observed that the main transportation route on the Rhine River is now closed to even some empty vessels because water level is too low. According to Federal Waterways and Shipping Administration, “the expected rain in the coming days is forecasted to increase levels on the Rhine River by 50-to-80 centimetres”. While rain may ease the current depth of the problem, there are commitments resulting from previous scrap contracts that are not still met due to the delay in transportation. Hence most players expect local German scrap prices to increase further in September.

As of today, August 23, a traditional scrap supplier of Turkey has offered a bid at €335/mt DAP Amsterdam for the grade equivalent of HMS I/II 80:20 scrap CFR Turkey. The sub-collector received this offer stated that “Since we expect prices to increase in September, we are inclined to wait further – maybe until the second half of September if prices do not surge up before.”

It is also noteworthy that “Germany’s central bank chief has warned that interest rates need to keep rising despite the risk of recession as inflation reaches double-digit levels for the first time since 1951”.

According to the latest data provided by the BDSV, in the first 20 days of August local scrap prices have moved down by €0.2-10.3/mt month on month. Additionally, the year-on-year decrease is now in the range of €54-111.2/mt. Prices are average prices for domestic transactions across Germany in the first 20 days of the given month. The prices are provided by Bundesvereinigung Deutscher Stahlrecycling-und Entsorgungsunternehmen e.V. (BDSV).

Scrap grade

Price: August 2022(€/mt)

Price: July 2022(€/mt)

Price: August 2021 (€/mt)

Monthly Change (€/mt)

Annual change (€/mt)

E1 - Old steel scrap

295.3

291

349.3

4.3

-54.0

E2/E8 - New steel scrap

352.7

351.1

449.1

1.6

-96.4

E3 - Heavy old steel scrap

326.1

315.8

406.6

10.3

-80.5

E40 - Shredded scrap

333.1

332.9

407.3

0.2

-74.2

E5M - Steel turnings

231.4

225.8

342.6

5.6

-111.2

Specifications:

E1 - Old steel scrap: thickness ≥ 4 mm, maximum dimensions 1,5 m x 0,5 m x 0,5 m
E2/E8 - New steel scrap: maximum dimensions 1,5 m x 0,5 m x 0,5 m
E3 - Heavy old steel scrap: thickness ≥ 6 mm, maximum dimensions 1,5 m x 0,5 m x 0,5 m
E40 - Shredded scrap: excluding incinerator steel scrap and collection scrap; density ≥ 1,1 mt/m3, Fe ≥ 92%
E5M - Turnings: excluding iron and automatic steel turnings


Similar articles

Global View on Scrap: Turkish market stabilizes, Asia recovers a little

29 Mar | Scrap & Raw Materials

South Korean and Vietnamese steel mills focus on domestic scrap or long-term import sourcing

29 Mar | Scrap & Raw Materials

Taiwan’s import scrap market recovers slightly

29 Mar | Scrap & Raw Materials

Import scrap prices in Bangladesh mostly stable in new deals

29 Mar | Scrap & Raw Materials

Local Italian scrap market still sluggish, prices stable

29 Mar | Scrap & Raw Materials

Mexican domestic scrap prices

28 Mar | Scrap & Raw Materials

Carbon and stainless scrap prices in Taiwanese domestic market - week 13, 2024

28 Mar | Scrap & Raw Materials

Turkey’s deep sea scrap prices stabilize at $385-390/mt CFR

28 Mar | Scrap & Raw Materials

CISA: Coking coal purchase cost in China down 9.86% in Jan-Feb

28 Mar | Steel News

US scrap market still expecting sideways pricing in April

27 Mar | Scrap & Raw Materials