After concluding some scrap bookings before the end-of-Ramadan holiday, Turkish buyers' scrap demand has appeared weak in the current week. Slack demand in the steel billet and finished steel markets and the softening price trend for scrap are causing Turkish steel mills to remain reluctant to conclude new scrap bookings.
In Turkish mills' latest ex-US scrap transactions, the price of HMS I/II 80:20 was at $408/mt CFR. As of today, August 28, ex-US HMS I/II 80:20 offers to Turkey are standing at $405-410/mt CFR. However, it is learned from market sources that Turkish mills' price expectations do not exceed $400/mt CFR.
On the other hand, towards the end of last week a Turkish mill had bought an ex-UK HMS I/II 80:20 scrap cargo at $403/mt CFR. Moving to this week, no new ex-Europe scrap offer has been heard so far in the Turkish market. Although the euro has shown some strengthening against the US dollar lately, this is not expected to have a significant influence on scrap prices, since European scrap prices have recently being set by using ex-US scrap prices as benchmark prices.
Turning to the Black Sea market, ex-Black Sea A3 scrap prices are currently above Turkish mills' expectations. Scrap collection prices in Romania are at $365-370/mt, while A3 scrap offers from Romania to Turkey are expected to be above $405/mt CFR. Besides, some ex-Russia A3 scrap offers to Turkey are reported to be standing at $410/mt. However, the price range of $405-410/mt CFR is not acceptable for Turkish mills and even offers of $395/mt CFR have failed to gain acceptance among Turkish buyers.
Approaching the end of August this week, the scrap market is not expected to witness significant movements. However, the market is foreseen to gain more clarity in the first days of September, when Europe returns from its holiday and as US domestic scrap prices come to light.