Despite the general expectation of a silent week, Turkish mills have accelerated their import scrap bookings towards the end of the week amid anticipated price increases. As SteelOrbis mentioned previously, rising collection costs, the ongoing slowness of scrap flow to export yards and sellers’ firm stance during negotiations were giving signals for a rise in deep sea scrap prices. Some Turkish mills have accepted the higher levels despite their slow rebar sales, while others explained their acceptance citing their sales in other segments such as profiles.
An Izmir-based producer has concluded an ex-Germany transaction for HMS I/II 80:20 scrap at $369/mt CFR. Another ex-Benelux deal is reported to have been done by another Izmir-based producer at around $366/mt CFR. Also, an ex-Netherlands booking by a steel mill in Iskenderun has been closed at $366/mt CFR, sources reported. Under the current conditions, SteelOrbis has revised its ex-UK/EU scrap prices to $365-369/mt CFR, with the lower end representing ex-UK bookings, indicating another $4.5/mt rise for this grade.
The Izmir-based producer has concluded another deal from Riga with HMS I/II 80:20 scrap standing at $369/mt CFR. This information has caused SteelOrbis to revise its ex-Baltic scrap price to $369/mt CFR, up $0.5/mt. Since no fresh deals have been done from the US, no change has been made for ex-US scrap, though, considering the traditional price gap between ex-US and ex-EU scrap prices, the US now has clear potential to move up further in the coming bookings.
Market sources report that there is a limited number of offers in the market, giving sellers leverage during negotiations. “Sellers want to see next week as they anticipate that mills will be more active in their search for available cargoes. Almost 12-14 deals have been done for February shipment. More shall be done in the coming weeks,” a European scrap seller commented today, January 9. Several Turkish mills have been seeking cargoes in the current week, but not all of them have managed to secure one. While some producers said that they are focusing on local scrap to gain time against overseas sellers, other sources from mills do not think this can be a long-term strategy. “Deep sea scrap prices are rising. The lack of availability is not only hitting us, it is hitting the sellers also. We see they are struggling to find the tonnages they need and were forced to increase their collection prices,” a source at a major mill said. Some mutual sympathy between sellers and buyers has been built up over recent weeks. Suppliers also admit that Turkish mills’ margins are very tight and that there is uncertainty surrounding their steel exports and local sales. “They need a gradual price increase if we consider the rising scrap quotations, but none of us are sure whether the new price levels will find buyers or not,” a scrap supplier told SteelOrbis. In the end, it is clear that Turkey’s deep sea scrap prices are firm and hold strong potential to move up further in the coming week.
