An ex-US scrap booking for HMS I/II 80:20 last week was at $445/mt CFR. This week, scrap ex-US is expected to be offered at similar levels. Japan, an important scrap exporter in the Far East, has almost stopped supplying scrap to the export markets. This has the effect of diverting Far Eastern scrap buyers towards US scrap purchases. Even Japanese producers have started to import US scrap cargoes.
Despite the US dollar approaching 1.45 against the euro, ex-Europe scrap prices have still managed to drop. In a booking made last week, a cargo consisting of 25,000 mt of HMS I/II 70:30, 5,000 mt of shredded and 3,000 mt of P&S scrap was booked at $422/mt CFR. The increase in the exchange rate is putting pressure on European scrap suppliers. Last week, a scrap cargo ex-Adriatic region of about 25-30,000 mt of HMS I/II 80:20 was sold at $420-422/mt CFR to Turkish producers.
A3 grade scrap ex-Black Sea has been dropping in price as well, after the last bookings made at $420/mt CFR levels. Today, Turkish buyers are not accepting A3 grade scrap offers at around $420/mt CFR.
Due to the lack of demand they are experiencing in finished steel sales, Turkish producers are delaying their scrap purchases as much as possible. Although they are expected to start buying soon in view of their current inventory levels, any new bookings which will be concluded by Turkish producers will likely not be sufficient to lift prices in the market.