Following a quiet start to last week in the Turkish scrap market, demand began to increase all of a sudden by the middle of the week. Since then, scrap prices have changed direction and started climbing.
The buying activity initiated by Turkish producers has lifted the prices of US scrap cargoes from their previous level of $365/mt CFR up to $379/mt CFR. A Turkish producer concluded a deal for an ex-US cargo at the end of last week, with ex-US HMS I/II at $377/mt CFR, shredded scrap at $382/mt CFR, and P&S scrap at $387/mt CFR. This week no offers have been heard in the market, and the common view is that no offers will be available under the level of $385/mt CFR for HMS I/II 80/20 scrap ex-US.
European scrap suppliers are also out of the market given the recent change of price direction. All those cargoes which failed to find any interest in the market despite being on offer for a while a couple of weeks ago, do not exist in the market any longer. The expectation of scrap suppliers is for prices to go higher in the forthcoming period.
The strengthening of demand last week also resulted in a price hike of A3 grade scrap ex-Black Sea from $350/mt CFR to $370/mt CFR. Various bookings were heard in the $370-375/mt CFR price range, while this week the price levels are assumed to have risen further up.
The short sea cargoes that were offered ex-Israel and ex-Lebanon in previous weeks at even below $350/mt CFR levels are today in the range of $355-360/mt CFR.
Continuing their purchases, Turkish producers appear to have some difficulty in finding offers in the market. With expectations of a further price increase, deep sea scrap suppliers have withdrawn their previous offers and are offering at higher numbers today. Steel producers are about to start replenishing their inventories ahead of winter and the fact that December loading cargoes have now started to be negotiated will keep scrap prices firm for a while.