The Turkish mills are observed to have gained a certain amount of relief for their scrap stocks for May by means of the massive scrap purchases they concluded last week; however, demand for prompt shipments of scrap continues to be registered. It is expected that scrap purchases will continue for a while this week, albeit not as intensively as last week.
The prices of ex-US HMS I/II 80:20 scrap have recorded an increase from their previous levels of around $239/mt CFR 10 days ago, against the background of high demand. This week it is heard that the offers in question are around the level of $250/mt CFR. Due to the expectations that scrap prices will increase in the US domestic market in May and that freight costs will also show an acceleration in May, ex-US scrap prices in Turkey are unlikely to soften in the short term.
A scrap cargo ex-Europe consisting of HMS I/II 70:30, shredded and P&S material is being offered to Turkish mills at the level of $248/mt CFR. The recent fluctuations of the €/$ exchange rate have also had some effect on ex-Europe scrap prices. Given the decline in the €/$ exchange rate compared to last week, it is expected that scrap prices in Turkey may show some softening. However, this expectation has not yet been reflected in the offer levels.
On the other hand, ex-Black Sea A3 scrap offers are around the price range of $250-255/mt CFR. The most recent ex-Russia A3 scrap booking has been concluded at the level of $250/mt CFR Nemrut. Also, it is heard that ex-Algeria HMS I/II scrap offers stand at around $240-245/mt CFR.
The recent rise in the volume of finished steel exports concluded by Turkish mills to Egypt in particular and to the UAE to a lesser degree has boosted Turkey's scrap purchases to a great extent. Increasing scrap demand from other regions as well as from Turkey has led scrap prices to rise from the level of $225/mt CFR to $250/mt CFR, indicating an increase of 11 percent within the space of a month. The stable movement of demand for both finished steel and scrap will ensure a slower rate of change of prices for these materials.