As market conditions remain uncertain, scrap demand from foreign countries is weakening along with export scrap offers from the US.
After an approximate $10/mt increase on ex-US scrap offer prices to Turkey about a week ago, US scrap exporters have retreated, returning scrap export offer prices back to the level of $455-$465/mt CFR Turkey. Due to the unstable political situation in North Africa and the Middle East, Turkish producers are hesitant to book scrap orders. However, considering the current low level of scrap inventory, Turkish mills are expected to purchase scrap tonnages soon in order to maintain steel production levels.
Similar to Turkey, scrap demand from the Far East is not strong as well, though some scrap buying activities have been observed in the market. Ex-US scrap prices to Taiwan were at approximately $460-$470/mt CFR in the past week. As Japan is the one of the world's leading scrap exporters, market sources expect that the current crisis in Japan will impact export scrap availability to Far East regions in the coming months, with South Korea a top concern. The last scrap cargo transaction from the US to South Korea was concluded at $490-$495/mt CFR.
Contrary to the scrap export market, scrap demand in the US domestic market remains strong along with the increasing capacity utilization rate from the domestic mills (the increasing trend has been consistent lately, although rates dropped 1.6 percent last week). Market insiders expect domestic scrap prices will go sideways to slightly up in April, depending on grade and region. However, there is speculation in the market that softening export scrap prices may weaken the US domestic scrap prices, despite the demand situation.