Over the past couple of weeks the Russian domestic scrap market has remained stable, to a large degree, against the background of increased activities in the ex-Russia scrap export market. Most mills have already completed the process of building their winter stocks and so have slowed down their scrap purchase activities. Consequently, with the stabilization of the market the domestic scrap price has seen small fluctuations (in the range of Ruble 50/mt) over the last couple of weeks, standing firmly in the range of Ruble 6,700-7,200/mt ($274-295/mt) CPT mill including VAT. The only exception to this situation may be observed in Russia's southern regions, where prices are generally higher than the country's average level due to the close proximity to the exporting ports.
Although, most of the steel mills have already built their winter stocks and have assumed a wait-and-see policy to future developments, no large decrease in the A3 grade domestic scrap market is expected till the end of the year as the rebirth of scrap demand from export destinations, especially from Turkish steel producers, acts as a counterbalance to a possible price decreasing trend in the Russian domestic market.
On the other hand, the Ukrainian domestic scrap market, which showed confusing tendencies at the end of last month, is currently moving toward stabilization. Whereas the reactivation of exports acted as a balancing force in the Russian domestic market at the end of November, it caused the Ukrainian domestic steel producers to raise their procurement scrap prices at the time as they sought to complete their winter stocks. Yet, from last week onward, a more stable trend has been seen in the Ukrainian scrap market, with price rises observed only from individual steel mills, while largely standing at the level of UAH 1,340-1,435/mt ($265-284/mt) CPT mill, excluding railway tariffs. On the supply side, over the last week increases in scrap deliveries to Arcelor Mittal Kriviy Rih and Makeevsk were observed. Meanwhile, prices and deliveries are expected to be stable, with maybe slight movements toward an increase, up to the end of the year.