The benchmark HMS I/II 80:20 scrap price in an ex-Europe booking done yesterday, August 6, to Turkey indicates a sharp fall. While some market sources believe that this transaction may remain an exceptional one and that prices in new deals may be higher, they also admit that there is a softening in offer prices.
SteelOrbis has learned that an ex-France booking done by a Marmara-based producer was closed at $376/mt CFR for HMS I/II 80:20 scrap and at $396/mt CFR for shredded and bonus grades. The cargo will be shipped in September and the total tonnage is 30,000 mt. This price level for HMS I/II 80:20 scrap is $7.5/mt lower than the previous levels recorded in ex-EU scrap deals heard last week. SteelOrbis will wait to see a second ex-EU booking before revising its price to the new level. For now, SteelOrbis’ reference price for ex-EU scrap has moved down just to $376-381/mt CFR.
Meanwhile, an older deal from Denmark has surfaced the market today, August 7. According to market sources, the deal was closed by a Black Sea-based mill for HMS I/II 80:20 scrap at $385/mt CFR and higher grades at $405/mt CFR. This price level also indicates a softening of ex-Baltic quotations by $4.5/mt CFR. SteelOrbis will revise its ex-Baltic reference price to this level and will adjust ex-US scrap prices to $385-390/mt CFR for now.
Turkey’s import billet bookings at more attractive prices are still being followed closely by market sources. However, a source commented that the next billet prices from Asia may not be as attractive they have been for weeks now. “Global financial instability will force them to increase their export offers. I believe prices will not be so attractive and that Turkish mills will not take any risks by ordering new cargoes.” Another source added, “Turkish mills’ scrap purchase strategy has been to keep delivery terms short for some time now. At least they will maintain this strategy when they start to buy cargoes for September shipment.” One scrap supplier commented, “This level mentioned in the ex-France booking does not work for us. We shall wait to see what other sellers will do.” A Baltic-based scrap seller also reported that two ex-Baltic scrap offers are in the market, with offer prices at around $385/mt CFR Turkey. September is traditionally a slower month in Turkey in terms of finished steel trading and for deep sea scrap market. Deep sea scrap quotations in Turkey are giving clear signals of a decline, but the extent of any decline remains to be seen.