Mood in Turkey’s import scrap market changed by large number of offers

Wednesday, 14 April 2021 16:43:44 (GMT+3)   |   Istanbul
       

The import scrap market in Turkey has been silent following the deep sea scrap transactions concluded at the end of last week, while the high number of cargo offers in the market has changed the market mood in terms of price expectations.

At the beginning of the current month, deep sea scrap quotations had been expected to move up at a slow pace as Turkish mills needed approximately 20-25 deep sea cargoes for May shipment. In the first nine days of April, Turkish mills concluded bookings for large tonnages and their needs for May shipments were reduced, so some producers have started to seek cargoes for June shipments. As a result, they are in no rush to conclude more deals in this environment of high availability. SteelOrbis has learned that there are at least 10 cargoes available for sale to Turkey’s scrap market, with sellers seeking opportunities to close transactions. With the arrival of spring, collection activities in the supplier regions are good. Meanwhile, deep sea sellers are not aggressive on pricing, some players stated, adding that some sellers are not willing to cut their prices to the levels of firm bids.

The most noteworthy recent event in the market is that a Canada-based supplier sold larger-than-expected tonnages to Turkey in at least three deals concluded last week, each fully consisting of 50,000 mt of prime grade. As SteelOrbis reported previously, one of these cargoes was bought by an Iskenderun-based mill with the HMS I/II 80:20 scrap price at $431/mt CFR and the second one closed by another producer in the same region signaling $438/mt CFR for the same grade. The high gap between the prices recorded in these two deals caused confusion in the market, according to market sources. However, scrap suppliers admit that the mood in the market has changed and that Turkish steelmakers now have leverage to exert more pressure on quotations. Some market players state that the deep sea HMS I/II 80:20 scrap price may decrease to levels of $430/mt CFR and below in the coming round of purchases. SteelOrbis’ current estimation for deep sea prime grade scrap is in the range of $425-430/mt CFR.

On the other hand, SteelOrbis has learned that three cargoes from the US have been sold to Egypt, with the HMS I/II 80:20 scrap sold at around $436-437/mt CFR. Meanwhile, a cargo has reportedly been sold to the same destination from Belgium, but no price level has been disclosed. Market players stated that demand for import scrap still exists in Egypt.

Due to Ramadan, activity in the local Turkish rebar market is expected to remain sluggish in the next week or ten days. Additionally, this week Turkey’s import scrap market is expected to be silent. One market player stated that the ex-Canada deals have caused the market to lose at least ten days of activity. Also, with the Turkish Central Bank’s decision on interest rates due to be announced tomorrow, market players are more willing to wait and monitor the impact of the decision on both the scrap and spot rebar markets.


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