After the US reduced the 50 percent duty on steel imports from Turkish to 25 percent in May, Turkish steel mills, which were already behind in their scrap purchases, swiftly restarted purchases in order to catch up. Supported by the many deals concluded by Turkish steelmakers, scrap prices changed their direction and started to move up.
After reaching $313/mt CFR as the end-of-Ramadan holiday drew closer, deep sea HMS I/II 80:20 scrap quotations declined slightly to $302/mt CFR during the last days of May as buyers slowed their scrap purchases.
Meanwhile, the steel markets in the Middle East and Turkey remained sluggish during the holiday period. However, on the first day of the current week, it was been heard that several ex-US East Coast scrap bookings were concluded by Turkish mills during the holiday. Two of these deals were heard to have been concluded for June shipments with HMS I/II 80:20 scrap at $299/mt CFR and at $299.5/mt CFR, respectively. On the other hand, in another ex-US scrap deal, HMS I/II 90:10 scrap was at $298.5/mt CFR. As a result, deep sea HMS I/II 80:20 scrap prices have decreased from the $302/mt level to $295.5/mt CFR.
However, it is observed that finished steel and billet buyers have started to expect lower offer prices since HMS I/II 80:20 scrap quotations are now once again lower than $300/mt CFR. Market sources state that Turkish mills, which have not fully started their purchases for July, are making scrap price inquiries as they seek more attractively-priced cargoes and seek to benefit from the lower scrap prices recorded in some regions of the US.
On the other hand, scrap prices are expected to be influenced positively and move up again once demand accelerates as purchases for July shipments start.