Small movements observed in Turkish scrap markets

Turkish mills have started to conclude some purchases, although in small amounts, as of mid last week after staying inactive for the last five weeks. The upward trend in scrap prices was a big surprise for Turkish mills that kept delayed their purchases with the expectation that the prices would decrease. The major factors triggering this rise were undoubtedly strong US and European markets and Euro/US Dollar exchange rate, which directly affects price of scrap ex-Europe. The price of HMS I/II 80:20 scrap, which was at $275/mt CFR Turkish port levels at the beginning of last week, reached $272-275/mt CFR Turkish ports through the end of last week. Likewise, the price of shredded scrap, which was at $275/mt CFR Turkish ports, indicated an increase through the end of last week. In Turkish scrap markets, a few deep sea scrap bookings were heard and reported last week. (Please see our raw material price reports section) Turkish mills were relatively more active in their Black Sea scrap purchases last week than those of “deep sea” scrap. Many mills were heard to have concluded A3 grade scrap bookings ex-Black Sea at $258.50-266/mt CFR Turkish ports. The most important reason for the price differences in these bookings concluded from Romania, Russia and Ukraine was the availability of Black Sea scrap in small tonnages and spot cargoes. While offers given by suppliers of bigger and higher tonnage cargoes are at higher levels, lower price levels are available for small tonnage cargoes and for spot sales. This week, further increases in the prices have been observed. Offer levels this week are heard to be at $270/mt CFR Turkish ports for A3 grade scrap ex-Black Sea, at $275/mt CFR Turkish ports for HMS I/II 80:20 ex-deep sea, at $280/mt CFR Turkish ports for shredded scrap ex-deep sea and at $265/mt CFR Turkish ports for HMS I/II 60:40 scrap. Taking Turkish mills strategy to keep away from purchases in the last few weeks into account, it is forecasted that more purchases will be heard as of this week.