As the current month proceeds, Turkish mills have successfully put the brakes on the uptrend seen in the deep sea scrap market. Market sources believe that the current range of $349-355.5/mt CFR observed for ex-UK/EU and ex-US scrap bookings is workable for all parties. “Both sellers and buyers are happy with this price range,” a source agreed today, November 12.
SteelOrbis has learned that an Iskenderun-based Turkish steel producer concluded an ex-US booking yesterday, November 11, for HMS I/II 80:20 scrap at $355.5/mt CFR. Another ex-US scrap deal done by an Izmir-based mill was also closed at $355.5/mt CFR for the same grade. As a result, SteelOrbis’ reference price for ex-US HMS I/II 80:20 scrap has remained stable.
A stabilization has been observed in the deep sea scrap segment since earlier this week, with Turkish mills slowing their purchases after last week’s flurry of activity. Collection prices at European export yards have remained in the range of €255-260/mt DAP, though market sources report that even the upper end of bids has failed to stimulate scrap flow to yards much.
The previous upward trend of deep sea scrap prices was supported by the livelier domestic rebar market in Turkey, which now also supports the firmness of scrap prices. In the local Turkish rebar market, buyers have restarted moderate restocking and accepted a certain price increase. Some market participants are finding a certain optimism in the Turkish government’s recently announced intention to build 500,000 of social housing units across the 81 provinces of Turkey, which is expected to give some boost to the construction sector. Still, many are skeptical regarding the financing and deadlines for these projects. Over the past week, Turkey’s rebar prices have risen by another $5/mt to $550-560/mt FOB, mainly for December shipments. The Balkan region is still the main export target for a majority of the mills, with a few inquiries lately received particularly from Romania and Bulgaria. A few ex-Turkey rebar offers are available at $550/mt FOB to Bulgaria, SteelOrbis has heard. In the Turkish domestic rebar market, official offers have increased by $10-15/mt over the past week to $560-580/mt ex-works. Moreover, workable levels across Turkey have also improved, by $5-15/mt depending on the region, which is a sign of cautious market support and moderate restocking.
Market sources report that import billet offers have little impact for now on the steel and scrap segments. The ex-China billet reference price is stable at $420-425/mt FOB ($462-465/mt CFR) with firm offers mainly at the higher end of the range. “We see lower offer volumes from China [‘s mills] and this is understandable as their production is going down,” a Southeast Asian trader said. Indicative offers from Malaysia are in the range of $485-490/mt CFR, while Indonesian billet offers are at $470/mt CFR. Ukraine and Russia are offering billet to Turkey at $490/mt CFR and $455-460/mt CFR and above, respectively. Meanwhile, domestic billet prices in Turkey are in the range of $505-510/mt ex-works.
Under the current circumstances, Turkey’s deep sea scrap prices are firm but have lost their upward support. Unless a change in the supply-demand balance is seen in the coming days, prices are expected to remain stable.
