Having been under pressure for weeks now, Turkey’s import scrap market has learned that a Turkish mill has bought an ex-UK cargo with a significant decrease in price. While many sources were already expecting a further decline in price, the extent of the decrease in the deal in question is considered to be surprising.
The Iskenderun-based producer has concluded the ex-UK booking for HMS I/II 80:20 scrap at $335/mt CFR, $10-15/mt lower than last week’s estimations for ex-EU/UK scrap prices. However, the cargo in question is believed to be a stressed one. Several market sources report that it will be shipped within the current month of April. SteelOrbis will wait for another ex-EU/UK deal before revising its prices to the level in question. For now, SteelOrbis’ reference price has been revised down by $10/mt to $335-340/mt CFR, while ex-US scrap prices have been cut by $5/mt to $345-350/mt CFR.
Buyers mention this is not the only stressed cargo or seller in the market. “There is a high number of stressed cargoes under the current circumstances because there are no buyers. Almost everyone has one cargo, while some have two cargoes on hand. But they are failing to find bids, not just attractive bids, but any bids,” a seller commented. Before the abovementioned deal from the UK, a European supplier was offering at $345/mt CFR and another was offering at $343/mt CFR, already signaling lower price levels for ex-EU cargoes. Turkish mills are exerting pressure on prices because their domestic steel sales, particularly in the rebar segment, are sluggish. “We can say the rebar segment is under unprecedented pressure. The large tonnages that cannot be consumed in the Iskenderun region are now leaking towards Izmir. Iskenderun-based mills are now finding a market share in Izmir. We never saw this before,” a source at an Izmir-based steelmaker commented today, April 16. A buyer of scrap said, “Scrap should stop falling. It directly impacts the appetite for rebar because buyers are now expecting lower rebar prices from us. Things [economically] are already hard for traders. Sharp declines for scrap or billets are unhelpful.” There is still a higher number of offers in the market, maybe lower during the rest of this week with Easter starting in the EU. A Germany-based sub-collector reported, “There is panic in the market today. Domestic scrap prices are declining day by day. Some buyers have stopped replenishing stocks or are giving aggressively low quotations.” There are still billet offers in the range of $460-465/mt CFR Turkey, keeping billet as a good alternative to scrap. “The negative sentiment surrounding Turkey’s steel and scrap markets is mainly the result of local conditions. People talk about export opportunities, but not all producers are ready to export. Additionally, international steel demand is on the low side. It will be a hard year for all small and medium enterprises, not just the ones in the steel business,” another source commented.
