Having started the week at a good pace in terms of deep sea scrap purchases, Turkish mills have taken a break over the past two days after seeing a rise in the number of deep sea scrap cargoes offered to the country. Meanwhile, some old deals have been disclosed to the market and a new deal has been closed from Venezuela.
An Izmir-based producer has bought the Venezuelan cargo, with HMS I/II 80:20 scrap standing at $473/mt CFR Turkey. No further information has been shared about this cargo at the time of publication. With this booking, Venezuelan scrap prices are once again in line with the prime grades from the US and the Baltic region.
The same producer bought another cargo from the US earlier this week. The cargo consists of 19,000 mt of HMS I/II 95:5 scrap and 11,000 mt of P&S grade scrap at the average level of $484/mt CFR. According to this information, the benchmark HMS I/II 80:20 scrap price is estimated to be at $470/mt CFR, $2/mt lower than the price in the previous ex-US deal disclosed to the market on January 10.
Also, a deal done last week by a Marmara-based producer has been shared with the HMS I/II 80:20 scrap price at $467/mt CFR, though this level is not indicative anymore.
SteelOrbis observes that the number of deep sea scrap offers to Turkey has increased and that there are at least ten offers from various destinations. Observing this situation, Turkish mills have taken a step back and are maintaining a wait-and-see position towards the end of the week, trying to exert some pressure to slow down the uptrend of prices. During this period, some mills are looking for short sea cargoes to gain some time. More than two sellers commented that a slight downward correction seems possible. The main problem in the market is the ongoing lack of significant finished steel exports, while trade in the domestic market is slowing gradually every day due to winter conditions. On the other hand, Turkish mills' production costs have increased significantly following the rises in electricity and natural gas prices as well as the increases in salaries reported by SteelOrbis yesterday, January 13. The local Turkish rebar market is expected to be quiet next week as another announcement by Turkey’s central bank regarding interest rates is due to be made next Thursday.