The relatively silent current week in Turkey’s import scrap market has seen some deals surface, with the prices in these deals attracting attention as they have moved in different directions depending on the region. The mood in the market is mostly negative, while Turkish mills continue to lower their domestic rebar sales prices.
An ex-UK booking was done by a Black Sea-based Turkish producer earlier today, October 26. The total tonnage in the cargo is 40,000 mt, consisting of 5,000 mt of bonus grade and shredded scrap at $377/mt CFR, while the balance will be HMS I/II 80:20 scrap at $352/mt CFR. This price is $7/mt higher than the previous ex-UK transaction done late last week, though there is a freight difference for cargoes delivered to the Black Sea of approximately $3-4/mt. SteelOrbis has revised its ex-EU reference scrap price to $348-352/mt CFR.
Also, an ex-Denmark booking was done by a Marmara-based mill with HMS I/II 80:20 scrap at $351/mt CFR, indicating a $1.5/mt drop for Baltic scrap prices. There are rumours about this deal being done last week but there is no consensus among market players about the date.
Although these two deals pushed ex-EU and ex-Baltic scrap prices to very similar levels, SteelOrbis does expect a revision in the coming days to a normal gap between grades. Hence, SteelOrbis is keeping its ex-US HMS I/II 80:20 scrap quotations at $355/mt CFR and is waiting for the next confirmed booking. Since Ford and the United Auto Workers (UAW) union have reached a tentative agreement, including a pay rise, the auto strike in the US may come to an end. This news has created positive sentiment in the US market, where domestic scrap prices were expected to remain sideways in November in a scenario where the strike continued. Some US scrap exporters say that they need to see the settlement in their domestic scrap market before offering cargoes to Turkey.
One source at a Turkish mill said that $340s/mt CFR for EU origin HMS I/II 80:20 scrap may be the bottom, while a representative of another mill said that lower prices are needed for Turkish mills to gain some margin. “Our export prices are merely in line with our competitors and there are still not enough tonnages sold to foreign buyers,” the latter added. Meanwhile, an Amsterdam-based scrap exporter has cut its collection prices to €275/mt DAP. SteelOrbis has heard that a Belgium-based exporter’s collection prices are currently at €275/mt DAP for HMS I/II 75:25 scrap, €285/mt DAP for HMS I/II 80:20 scrap and €305/mt DAP for bonus grade scrap. All players in the EU agree that scrap flow to export yards is not great, while some sub-collectors report they can take a step back for the rest of 2023 and increase their inventory levels instead of sending materials to export yards at these levels. It should also be recalled that keeping materials on hand closer to the year-end may provide a tax advantage for European suppliers.
Currently, ex-Romania HMS I/II 80:20 scrap prices have declined below $320s/mt CIF, while a deal has been closed at $317/mt CFR Turkey. Trading in the short sea segment is slower than usual, market sources report.