As Turkish mills continue to show appetite for deep sea scrap purchases, they are forced to accept higher price levels. After deep sea scrap had previously fallen to around $330/mt CFR, sellers’ resistance to such levels caused a sharp upward correction, and the uptrend is expected to continue until the supplier regions exit the market for their holidays.
Steelorbis has learned that an Iskenderun-based producer has concluded an ex-Germany booking for HMS I/II 80:20 scrap at $349.5/mt CFR. This price is $7.5/mt higher than that in the previous deal reported by SteelOrbis on Friday, December 20.
Two more transactions from the EU have surfaced today, Monday, December 16, both done late last week. An ex-UK booking was done by a Marmara-based producer for HMS I/II 80:20 scrap at $340/mt CFR. Another transaction was done by another producer in the Marmara region, with the cargo consisting of HMS I/II 80:20 and bonus scrap in equal tonnages, with the average price level of $353/mt CFR. This information signals $343/mt CFR for HMS I/II 80:20 scrap, with the gap between these grades standing at $20/mt. Having shared this information, these price levels have now been surpassed due to the abovementioned ex-Germany booking.
With ex-European scrap prices moving up very sharply, from the $337/mt CFR level recorded on December 1, to $349.5/mt CFR confirmed today, US-based suppliers are also expected to follow the rising trend. Against the $12.5/mt rise in the European scrap segment, ex-US HMS I/II 80:20 scrap prices have only increased by $7/mt since the beginning of the month. Late last week, ex-US offers moved up from $350/mt CFR to $355/mt CFR Turkey, with these levels considered acceptable today. Some market sources believe that the next ex-US deal may be closed above $355/mt CFR. “Deep sea scrap price are drawing closer to $360/mt CFR, though I consider the possibility of breaching $360/mt CFR to be small. Turkey is paying the price of its previous actions. Turkish mills exerted too much pressure on deep sea prices, and some even believed prices would fall beyond $320/mt CFR. Now, ahead of the holiday season, sellers are not so active, waiting for higher levels,” a European scrap supplier commented. Another source stated, “Half of this recent price increase can be considered a correction. Turkish mills stretched the market while prices were dropping. From the current levels, a bit of a rise can be seen. We need to monitor the major mills’ return for new cargos and obviously the next ex-US scrap price. Because the domestic markets in the EU and the US are weak, only Turkey’s appetite supports the current uptrend.”
SteelOrbis has learned that ex-Romania bookings were previously closed at $325/mt CFR Turkey for HMS I/II 80:20. Currently, sellers are monitoring the recent uptrend in the deep sea segment, while waiting for higher price levels. “Suppliers are mainly out of the market. We are not receiving any offers from the short sea segment,” a Turkish mill reported. A short sea scrap supplier commented, “Our principals are waiting right now, sharing no offers with Turkish mills.” SteelOrbis believes the indicative prices for ex-Romania HMS I/II 80:20 scrap price are at around $330-335/mt CFR, $5/mt higher than the previous levels.