Turkish mills have continued to show demand for deep sea scrap since late August. There are fewer Turkish mills seeking scrap now, whereas last week there were around eight producers seeking deep sea cargoes. While Turkish mills are still trying to restrict the rise of prices, even trying to exert more downward pressure, European scrap sellers comment that they are quite unwilling to cut back prices. “Some mills are bidding below $360/mt CFR again, but there was no margin then or now for us at such prices,” a European supplier commented.
At the end of the week, ex-US scrap prices in Turkey settled at $370/mt CFR. Market sources report that the upward trend of Turkey’s import scrap market may be adversely impacted by the negative movement observed in China. While some market players think that Turkish mills may have started to come under pressure to export due to the billet imports they have already bought under the scope of Turkey’s inward processing regime, others think they still have time. Another source said that prices will stabilize from now on, “I think $370/mt CFR will be the ceiling for this round of bookings. Several US suppliers are in the market with offers. I hear at least three Europeans are seeking buyers.” Meanwhile, a German sub-collector reported that bids from an Amsterdam-based export yard have increased by €10/mt DAP to €295/mt DAP.
Under the current conditions, the deep sea benchmark HMS I/II 80:20 scrap prices in CFR terms have moved up by 2.23 percent week on week. The prices are now 3.55 percent lower month on month in the deep sea segment, with prices being in the range of $363-371/mt CFR.
US ferrous scrap pricing for the month of September is seen sideways to lower in the US Midwest amid scant finished steel demand and reduced steel capacity due to outages, while US East Coast scrap is expected to perform better, with a sideways assessment expected across all grades, largely due to better demand and higher prices from the main scrap exporters, US scrap market insiders told SteelOrbis this week.
SteelOrbis has learned that the current price for Mexican domestic shredded scrap has declined by MXN 250/mt ($12/mt) over the past week to MXN 7,350/mt ($362/mt) Additionally, HMS I/II scrap prices have decreased by MXN 200/mt ($10/mt) over the same period to MXN 5,650/mt ($278/mt).
In August, local scrap prices in Italy lost an average of €20-25/mt. According to sources, prices were dragged down by the declines in the European and international markets and by the continuing difficulties in the finished steel market. “Some mills have not yet resumed operations and in any case scrap yards are quite full as we have been idle all August and there are no new incoming orders,” said market participant said. Given this situation, steel mills are intent on lowering scrap purchase prices even further in the near future. On the other hand, traders point out that, although demand for raw material is extremely low, supply is also very scarce and it is difficult to predict in which direction prices will move.
Over the past month, the local scrap market in Spain has also experienced a significant drop, losing €25-30/mt. According to market participants, the fall in prices was due to the low trading activity during the summer holidays, as smaller mills remained out of the market throughout August. Even though market participants expected a slight improvement in trading activity and a €10/mt recovery in local scrap prices, the market remained quiet with stable prices.
The leading Japanese EAF-based steel producer Tokyo Steel announced consecutive price cuts last weekend and this week. Currently, Tokyo Steel’s general range for H2 grade scrap has declined by JPY 500/mt to JPY 43,000-44,500/mt ($301-312/mt) depending on the mill. Shindachi scrap prices of Tokyo Steel have settled at JPY 44,500-45,500/mt ($312-319/mt) delivered, with the lower end represented only by the Takamatsu yard.
Vietnam has continued to remain inactive in the import scrap segment this week amid the lack of steel demand in the country, especially for flat steel. Offers for Japanese H2 scrap to Vietnam have declined by $5/mt over the past week and are now at $355-360/mt CFR. Offers for ex-US bulk HMS I/II 80:20 scrap are still in the range of $365-370/mt CFR Vietnam.
As anticipated by SteelOrbis, Taiwan’s import scrap market has already hit the bottom, with import scrap prices remaining relatively stable over the past week. While offers for ex-US HMS I/II (80:20) scrap in containers have remained unchanged over the past week at $323-328/mt CFR. Offers for Japanese H1/2 (50:50) scrap bulk are now at $345/mt CFR Taiwan, declining slightly from $348/mt CFR recorded early last week.