In the last three weeks, scrap prices in the German market showed a movement from stable to upwards, both for domestic and exports markets. The past week especially registered a peak in local scrap prices.
According to sources, the main reasons of these increases are better finished steel demand – especially for electric steel – coupled with the local scrap scarcity, especially for some grades such as E1. In addition, steel consuming companies have reduced their working hours, contributing to a lower scrap generation. The construction sector is still stagnating, and the strongness of the US dollar also makes exports more favorable.
A mill in southwest Germany increased its scrap purchase prices by up to €14.5/mt, whereas in the eastern part of the country another producer kept them unchanged. In northern Germany, scrap purchase prices from a mill were up to €5-12/mt. Negotiations, though, are still happening.
Sources reported that mills are producing at a regular pace, but what will happen after the elections remains unclear. Commenting on the price increases, an Italian scrap trader selling material to Germany said: “Everyone woke up suddenly at the end of last week, after the latest deals from Turkey, and they understood they could obtain a price increase”. “Everybody is going crazy. Pre-material to the shear went up to €265/mt. There are bets on increasing prices,” another local trader in Germany commented.
On the exports side, players in Amsterdam, Rotterdam, Antwerp and Ghent are paying around €305-310/mt CIF for HMS I/II 80:20, “but everyone is cautious at the moment because no one knows in which direction things are going and what effects the US import will have”, a source commented.