A new deal from the Baltic region has been shared today, January 20, in Turkey’s import scrap market, with the price indicating a sharp decline.
SteelOrbis has learned that an Iskenderun-based producer closed the deal from the Baltic region for HMS I/II 80:20 scrap at $400/mt CFR, shredded scrap at $420/mt CFR and bonus grade scrap at $420/mt CFR. The cargo will be shipped in early March. No further details have been confirmed by the seller or the buyer at the time of publication, though, according to some rumors, the cargo also consists of busheling, oxy and railway scrap. Prior to this deal, SteelOrbis’ estimations for ex-Baltic scrap were at $405-413/mt CFR, revised after the ex-US booking at $413.5/mt CFR for HMS I/II 80:20 scrap.
Despite the fall observed in this ex-Baltic booking, market players generally think that the deep sea scrap market will stand firm in the coming period. “Collection prices in the EU are not softening, on the contrary European mills are increasing their steel prices,” a German source reported today. An Italian source reported that long steel producers have increased their scrap procurement prices by €15-30/mt, while special steel producers have increased them by €30-40/mt. SteelOrbis has already reported that dock prices in the US have increased by $10-15/mt week on week. A seller commented, “There were many offers when Turkish mills were accepting prices in the range of $410-420/mt CFR, but now the number of offers is lower. Hence, if sellers do not panic, prices will remain firm.” According to sellers, European HMS I/II 80:20 scrap is still at $400/mt and above, while US HMS I/II 80:20 scrap is at $410/mt CFR and above. However, a Turkish mill reports that their expectation for European scrap is in the range of $390-400/mt CFR. “I do not expect a collapse either, but, taking the rebar prices and demand into consideration, this is the level that makes sense,” the source said. All market players are speculating on China’s return from its holiday, with expectations differing. SteelOrbis believes that China will make a positive return from its long-week holiday which will end on January 30. SteelOrbis’ Asia-based sources also believe the Covid-19 epidemic in China will be under control in the short term. Turkey’s domestic rebar prices are moving down amid a lack of exports. While the official rebar quotations have remained at around $710-730/mt ex-works, the unofficial sale prices are closer to $700-710/mt ex-works. Despite the decline in local rebar quotations, traders are not convinced the downtrend is close to ending. The general expectations in the spot market are for producers’ rebar prices to decline below $700/mt ex-works.
The short sea scrap market is feeling the pressure more than the deep sea segment. Some Romania-based sources think that short sea HMS I/II 80:20 scrap prices have room to go below $375/mt CFR Turkey. “The range of short sea scrap prices is set to widen,” a source reported, “Not all accept lower bids from mills, but the ones with less financial freedom will be forced to lower their quotations.” SteelOrbis’ short sea scrap prices will be revised to $375-385/mt CFR for now.
