In the past week, Turkish steel mills have become active in scrap purchases. Following two scrap transactions concluded early this week, one ex-Baltic scrap deal at $385/mt CFR and another one from St. Petersburg at $382.5/mt CFR, the downward price tendency has become apparent in the scrap market. And today, April 18, two new ex-Baltic scrap transactions by Turkish mills have been reported.
Accordingly, a Turkish mill has concluded a booking for an ex-Baltic scrap cargo of 35,000 mt composed of A3 scrap and P&S scrap at $384/mt CFR, while another Turkish mill has booked a cargo composed of 20,000 mt of HMS I/II 80:20 scrap and 8,000 mt of shredded scrap at $382.5/mt CFR Turkey.
Recently, no new scrap transactions have been heard from Romania to Turkey, while the latest A3 scrap transaction price from Romania for Turkey was $372/mt CFR. However, ex-Romania A3 scrap offers to Turkey have now declined to the level of $368/mt CFR. After this price drop, it is thought that Turkish mills may increase their ex-Black Sea scrap bookings. In the meantime, ex-Russia A3 scrap is being offered to Turkey at $380-385/mt CFR, though demand for these offers has remained low.
Moving to the other side of the Atlantic, after last week's transaction of ex-US HMS I/II 80:20 concluded at $392/mt CFR, no new transaction or offer has been heard so far. Turkish mills are reported to be exerting pressure on ex-US scrap suppliers to cut their prices to $380-385/mt CFR. However, ex-US scrap suppliers have not made any such move so far. If ex-US scrap prices decline to the levels desired by buyers, then the whole market will be influenced and the scrap price decline will become official. Thus, suppliers are currently adopting a wait-and-see stance.
Demand for scrap has remained relatively low lately, as steel producers have preferred to use semi-finished materials for their productions, rather than scrap. Although Turkish mills are currently meeting their scrap needs with ex-short sea scrap purchases, it is thought that these producers may switch to ex-deep sea scrap bookings soon, after they deplete their scrap inventories.