Discussions about how the scrap market will trend in Germany in December have started to be heard this week. After the slight rises recorded in November which were substantially caused by higher demand from scrap exporters, low scrap availability and domestic mills’ attempts to compete for scrap, views in the local scrap market in Germany are now divided.
On the one side, scrap sub-collectors are seeking to raise their sales prices further in this month’s contracts, considering that there have been no changes in scrap availability. On the other hand, several factors need to be considered. First of all, even though some sources have reported higher volumes requested by mills, their warehouses are full and some of them have already stopped receiving scrap. Secondly, the export market continues to be lively, especially in the northern part of Germany, as the volumes requested by Turkish mills are still on the high side. Lastly, the quality of scrap generated in the German market is lower than usual, which gives scrap sub-collectors greater opportunities to sell to the export market as exporters’ quality standards are not as high as those of local mills.
At the same time, though, reports of higher scrap purchase prices from local mills are circulating in the market, and some sources have reported unofficial increases by €8-10/mt. This, however, does not apply to all producers, which means that scrap purchase prices will only be increased by those who have a real need to buy.
To conclude, SteelOrbis anticipates that this month’s trend will probably see prices rise in the northern part of the country, where competition with scrap exporters is higher, and unchanged prices in the south where logistics issues continue to disrupt sales to neighboring countries.
