Turkish mills suspend their scrap bookings amid abundant offers and lower prices

After suspending their scrap booking for a few weeks, Turkish steel producers returned to the scrap market last week and were met with an abundance of offers, which led them to delay their scrap bookings again. SteelOrbis has learned that the main reason for Turkish steelmakers' retreat from the scrap market before satisfying their scrap needs is their anticipation of a further decline in scrap prices given the plentitude of offers.
 
In the past week, ex-US scrap transaction prices for Turkey have regressed to the level of $495/mt CFR for HMS I/II 80:20 grade. In the US domestic scrap market, scrap prices for February have decreased by about $25/mt, which is also interpreted as a sign that ex-US scrap prices will decline for Turkey. While no scrap booking has been reported to have been concluded so far, the ex-US scrap price for Turkey is expected to decrease to the level of $485/mt CFR this week.
 
On the other hand, ex-Europe scrap prices have continued to move down. This week, ex-Europe scrap offers to Turkey for HMS I/II 70:30 scrap have declined to $473/mt CFR.
 
SteelOrbis has learned from market sources that a few ex-Black Sea scrap transactions have been concluded in the Turkish steel market. Meanwhile, Russian and Romanian scrap suppliers have been facing difficulties in adjusting their A3 scrap offer levels in a downward direction in order to satisfy Turkish mills' expectations. After the latest ex-Black Sea A3 scrap transaction at $480/mt CFR, Turkish steel producers' price idea has declined to $470/mt CFR.
 
It seems that the Turkish steelmakers still need to buy scrap; however, the uncertainty of the possible influence of the political turmoil in Egypt on the steel markets, as well as the continuing decrease in scrap prices, have led them to delay their scrap bookings for the moment.