Older deals done last week surfaced in Turkish import scrap market today, August 27, market sources reported that the deals from the US were done before ex-US HMS I/II 80:20 scrap dropped to $360/mt CFR.
Two ex-US scrap deals reportedly done by producers in Izmir and Iskenderun with the HMS I/II 80:20 scrap prices standing at $365/mt CFR and $363.5/mt CFR. These price levels are above the last confirmed ex-US booking done late last week. But as mentioned before, they are also believed to be signed before the transactions closed at $360/mt CFR Turkey for this grade.
Most market sources think that the market has hit the bottom, especially with the ex-EU scrap suppliers failing to cut their collection prices. There is another rumour of an ex-EU deal done at lower than $355/mt CFR recorded late last week for ex-UK cargoes, but this deal was denied. Hence, SteelOrbis will not share the details circulating the market. One player in Turkey’s import scrap market commented on European scrap today, agreeing that lowering prices for European sellers is not easy under the current conditions. Reports coming out of the US are also creating new questions. US-based mills are bringing forward their annual maintenances which are usually done later in the year. Therefore, local demand in the US is expected to decline in September. How this will impact the scrap availability for exports is yet to be seen, though price expectations for September is now sideways to downwards. The downward pressure coming out of China is somewhat softening. Average Chinese domestic rebar and wire rod prices have moved up amid the increasing rebar futures prices after the Chinese government forbids the capacity replacement program and there are talks about some better market balance after weeks of visible oversupply. While Chinese billet offers to Turkey have also moved up, some market sources remind that the current offer levels may not be firm for now and there is still an expectation that this uptrend in China can be temporary. Indicative billet offers from China today are at around $485/mt CFR. Under the current circumstances, Turkey’s import scrap market is still in the range of $355-360/mt CFR and further drop seems unlikely.