It is observed that Turkish steel mills' scrap purchases have slowed down as they have maintained a cautious stance. During the past week, import scrap prices in Turkey have continued their downtrend. In the most recent import scrap deals concluded in Turkey last week, ex-EU HMS I/II 80:20 scrap prices were at $319-322/mt CFR, while ex-US HMS I/II 80:20 scrap quotations were at $328/mt CFR. Also, a Turkish steel producer concluded an ex-St. Petersburg deal last week for HMS I/II 80:20 scrap at $318/mt CFR. In the current week, no new import scrap deal has been made in Turkey nor has an offer been heard.
The apprehension in steel markets has increased following the US President Donald Trump’s tweet on Friday, August 10, stating that he authorized to double tariffs on Turkish steel imports. After the tweet in question, Turkish lira lost significant strength against other currencies during the first exchange transactions in Asian markets on Monday, August 13, with Turkish lira-US dollar exchange rate exceeding TRY 7 to a dollar threshold. Although the loss in Turkish lira has been compensated in some degree following Turkish Central Banks’ intervention by announcing a series of measures to "provide all the liquidity the banks need", exchange rate has continued to fluctuate in a wide range.
Sharp movements recorded in Turkish lira-US dollar exchange rate has caused domestic rebar purchases in Turkey to be concluded only in line with needs as it has led domestic rebar prices to increase further. It is observed that buyers in Turkish scrap market have been maintaining a wait-and-see stance as of the beginning of the current week since there are no concrete signals of a revival in domestic and export finished steel sales and also due to the sharp fluctuations seen in exchange rate. In the meantime, scrap suppliers are not experiencing any problems as regards supply volume, and so are waiting to receive demand from Turkish steel producers to submit offers. Turkish mills are expected to start purchases to complete their lacking September shipments before the Feast of Sacrifice holiday, which will last a full week starting from August 20, and so may conclude few scrap deals in the coming days.