Turkey’s import scrap market has continued its downtrend with a new ex-US transaction which has indicated a sharp decline of almost $20/mt in one go. While Turkish mills think that this new level was expected, some US scrap sellers believe not everyone will accept this price level.
SteelOrbis has learned that the ex-US deal was done by a Marmara-based producer for HMS I/II 80:20 scrap at $355/mt CFR, shredded scrap at $375/mt CFR and bonus grade scrap at $375/mt CFR. The previous ex-US booking was closed at $375/mt CFR almost ten days ago.
Steel demand in Turkey has been very weak for some time, and the situation is getting worse due to the struggling economy. Construction projects are slower than usual, Turkey’s exports are at very low levels, and mills are depending largely on domestic demand. As a result, they are taking breaks from production, with some bringing forward their maintenance works, some cutting shifts and others closing some production lines. Accordingly, Turkish producers’ need for deep sea scrap is also decreasing. The pressure exerted on deep sea and short sea scrap is huge, causing collection prices to move down. A German-based sub-collector stated that collection prices in Amsterdam and Belgium have moved down to €270-280/mt DAP, adding, “We have accepted these levels to move some stocks. I cannot say it is a large tonnage, but the price is already there.” While the lower end of the EU scrap collection price range equals $344-345/mt CFR Turkey at breakeven, excluding financial costs, profits, etc., many European scrap exporters believe their average cost of scrap inventories is mostly higher than this. A European exporter pointed out that collection prices have declined from €330-335/mt DAP. Meanwhile, a contact from a major Turkish mill said it would not be a surprise if prices move down further under the current circumstances. “There is no proper steel sale that we see or hear in the market to support higher scrap prices,” he added.
In the short sea segment, Turkish mills are seeking $325-330/mt CFR for ex-Romania HMS I/II 80:20 scrap. Some deals may have been done in this range, though most Romanian sellers are asking for higher prices in the range of $330-335/mt CFR and above.