The lack of deep sea scrap cargoes has continued for the third week in Turkey’s import scrap market, causing uncertainties to intensify. The general expectation in the market is for a downward revision of prices, though market players are becoming more cautious in voicing levels with each passing day.
The European HMS I/II 80:20 scrap price is estimated at around $600-610/mt CFR, while quotations for this grade of US and Baltic origin are expected to be around $615-625/mt CFR. “There can be lower prices fixed in the first deals, and no one will be surprised,” a supplier commented. SteelOrbis hears that there are still no price inquiries by Turkish mills, who are still struggling to sell finished steel. “We will see the real price level when someone buys a cargo,” a US-scrap supplier stated, “The price is set by the supply-demand equilibrium and all see that there is no demand in Turkey right now.” An ex-EU scrap seller expects a recovery in prices after hitting a bottom of around $580s/mt CFR. “Nothing has been bought for June shipments in the scrap market, eventually Turkish mills will start to book cargoes,” the source stated. It is observed that European export yards are lowering their collection prices and the local US scrap market is expected to move down in the May-buy cycle.
A Turkish long steel producer stated, “The local rebar market is a bit livelier over the past three days.” But still there are no export sales disclosed in the market in significant tonnages, which would support the scrap market. Several market players voiced their expectations of a recovery in both finished steel and scrap demand after the end-of-Ramadan holiday (May 1-4). “There is postponed rebar demand, but one shall not forget the negative impact of higher costs and inflation on the construction sector,” a Turkish mill commented. A flat steel producer stated that it is a matter of finance. “Prices have risen too much, the output sale-input purchase balance is monitored closely by producers.” From the producers’ side, there are comments that the willingness of scrap suppliers to conclude sales has also decreased over the past week. “Suppliers also want to see their collection costs and evaluate their positions - whether it is safe to sell or not at the desired levels without a loss,” a steelmaker commented. The risk of Turkish mills reducing their shifts has also been mentioned, while some producers in the Iskenderun region are already known to be working with reduced shifts.
Meanwhile, the short sea scrap market has remained stable in the range of $555-560/mt CFR Turkey. Since short sea scrap prices have softened rapidly over past weeks, sellers are taking a break to see the future levels which will be recorded in the deep sea segment.
