Turkey-based MMK Metalurji has bought its first deep sea cargo after activating its electric arc furnace, and the deal was disclosed to the market today, July 30. Overall, in 2021 the mill expects to produce 200,000-260,000 mt of HRC and to reach maximum capacity utilization next year.
SteelOrbis has learned that the steelmaker has preferred an ex-St. Petersburg cargo for HMS I/II 80:20 scrap at $469/mt CFR and bonus grade scrap at $484/mt CFR, for August shipment. With this deal deep sea HMS I/II 80:20 scrap prices have decreased slightly from the level recorded in the ex-US deal closed at $471/mt CFR this week.
Baltic sellers have been out of the market, particularly the Russian ones following Russia’s decision to exert export duties on scrap. As Russian scrap exporters reduced their collection prices, they are currently able to sell to Turkey at the mentioned price levels, one source states, adding that the duty will cause the flow for exports to slow down.
Meanwhile, there is an unconfirmed rumor in Turkey’s import scrap market about a Marmara-based mill buying an ex-Belgium cargo for 25,000 mt of HMS I/II 80:20 scrap at $465/mt CFR, 15,000 mt of shredded scrap at $480/mt CFR and 5,000 mt of a mixture of HMS I and P&S grade scrap at $480/mt CFR. This deal has not been confirmed by the buyer or the seller at the time of publication but the price has been considered logical by many market players. As a result, SteelOrbis revised its ex-EU HMS I/II 80:20 scrap quotations to $465/mt CFR, $2.5/mt lower than the previous level.
Market players state that one of the sellers that had been in Turkish market has sold its cargo to Egypt, and the number of offers is now lower as compared to the beginning of this week. China’s positive signals are supporting the mood, some state. Some market players believe that prices in the Turkish steel market are very close to the bottom levels, adding that this will also support import scrap quotations. Meanwhile, high freight numbers are causing some uncertainties in international trade. A source states that they decided to give export offers on FOB basis under the current circumstances. Also the spread between finished steel and scrap prices are still very large, SteelOrbis observes. One market player states that even for rebar prices being at $700/mt ex-works, the gap between rebar and scrap is now $230-240/mt.
Following the decreases recorded on the deep sea segment, HMS I/II 80:20 scrap from Romania and Adriatic is expected to be bought at levels of $435/mt CFR and below. Demand is still sluggish on the short sea side, though players think that there will be some deals heard at the beginning of next week.