Turkish steel producers have not yet resumed their
scrap buying, despite the significantly low levels of their
scrap inventories caused by the continued postponement of their bookings. The main reason for the ongoing postponement is the price decline seen both in flat and long steel prices. Besides, the weakening of the euro against the
US dollar, with the exchange rate dropping to 1.31, and the softening of
scrap prices have also contributed to producers' decision.
Although there are not many ex-
US scrap offers to the Turkish market right now, it is heard that there are some
scrap suppliers with
scrap in hand who are ready to start negotiations with their Turkish customers, once Turkish mills switch to buying. It is also heard that ex-
US HMS I/II 80:20
scrap offers to
Turkey are at $465/mt CFR; however, Turkish producers are not inclined to buy at this level.
Ex-
Europe scrap prices have witnessed a steep decline, with the further weakening of the euro. It is reported that a European supplier has offered HMS I/II 80:20 to
Turkey at $429/mt CFR.
As for the Black Sea basin,
scrap collection prices in
Romania stand at about $400-410/mt. While Romanian A3
scrap offers to
Turkey are at $440-445/mt CFR, an ex-
Russia A3
scrap transaction in
Turkey has been concluded at $438/mt CFR.
Despite their urgent need for
scrap supplies, due to price declines and uncertainty clouding over the finished steel market outlook, Turkish mills are currently heading for
scrap purchases with small tonnages, abstaining from ex-deep sea
scrap bookings. However, unless a production cut occurs, it is thought that producers may wait until next week at most and will finally be forced to conclude some ex-deep sea
scrap bookings.