Turkey has finally started to conclude deep sea scrap deals following the long absence of transactions, with the new price levels indicating a significant rise, as expected by SteelOrbis. Market sources still report that there are not enough concrete offers from sellers and that it is still a seller’s market.
Today, March 25, began with news of a new ex-Netherlands booking done by a Marmara-based Turkish steel producer, with the HMS I/II 80:20 scrap price standing at $385/mt CFR, which is $7.5/mt higher than the previous indicative levels. An ex-Belgium transaction was closed by an Iskenderun-based producer yesterday, with the average price of the cargo at $396.5/mt CFR, and the HMS I/II 80:20 scrap price standing approximately at $387/mt CFR. As a result, SteelOrbis has revised its ex-UK/EU scrap prices to $385-387/mt CFR, increasing them by $8.5/mt.
Meanwhile, an ex-Denmark cargo has been bought by another Marmara-based producer, with the benchmark scrap price slightly higher than $392/mt CFR. It is rumored that an ex-Finland deal was closed by an Izmir-based steelmaker with HSM I/II 80:20 scrap standing at $390/mt CFR. This information was not confirmed by the buyer or the seller by the time of publication. As a result, SteelOrbis’ ex-Baltic scrap quotations have increased to $390-393/mt CFR, up by $7.5-10/mt.
Today, a Germany-based sub-collector reported that they received bids from a Belgium-based exporter, with the HMS I/II 70:30 scrap price at €280/mt DAP, HMS I/II 80:20 scrap at €285/mt DAP and bonus grade scrap at €300/mt DAP. Another exporter in Amsterdam reported that their collection prices are at €280/mt DAP and scrap flow has been sustained at this level for a while, though it is slowing down as sub-collectors aim for higher levels. A German sub-collector said he thinks that exporters’ collection prices are not on a par with the local market, with European steel producers’ prices being more attractive. “A €5/mt increase is possible in EU-based exporters’ collection prices in the coming days,” he said.
Market sources report that ex-Romania HMS I/II 80:20 scrap offers have increased to $380/mt CFR and above. A buyer confirmed that a range at $380-385/mt CFR for this grade can be workable, depending on the quality. Meanwhile, an Amsterdam-origin cargo is offered to Turkey at around $392/mt CFR, sources added. While ex-UK scrap cargoes were offered at around $390/mt CFR yesterday, sources agree that all previous offers may be adjusted after today’s confirmed deals. “I do not mean that prices may fall. We still cannot receive a concrete offer from the US and we think they will aim for higher levels than the Scandinavian bookings,” a source at a Turkish steel producer commented today. Another source at a mill agreed saying it all may depend on buyers’ positions, noting, “Prices can change depending on the delivery term and the composition the mill needs. Some producers may need prompt cargoes as Turkey has waited a long time.” A third source at a major Turkish mill said, “It is impossible to make an assumption about where this is going. We are failing to sell finished steel and are forced to increase our prices daily. Still, demand is on the lower side.” A supplier commented, “Bids from mills are all over the map. Some bid very low levels, while others are more open to higher levels during negotiations.”
Billet prices have moved up considerably in the Turkish market this week, fueled by a rapid uptrend in the domestic rebar market. Although the demand for rebar is still more on the cautious side, most market players believe that the upturn is justified based on increasing energy costs and the chaotic situation in the global freight market. The domestic rebar prices increased in two steps by around $30/mt from the pre-holiday levels and are now at $580-605/mt ex-works depending on the region. Higher rebar prices have triggered the price rise for local billet - from $510-520/mt ex-works before the holiday to $530-540/mt ex-works minimum now. Some mills might try $550-555/mt ex-works/CPT levels quite soon, SteelOrbis understands.
For now, deep sea scrap sellers continue to maintain strong positions against Turkish mills. The uptrend of the deep sea scrap market is not believed to have come to an end yet. Most expect ex-US scrap prices will be higher in the coming deals.