With the US dollar hitting 1.05 against the euro, negative sentiment prevails in Turkey’s import scrap market, causing workable price levels to fall. There have been several rumors of deep sea and short sea scrap bookings over the past two days, but most of them have been rejected by at least one of the supposed parties to the deals. October 2023 was the last time the euro was so weak against the US dollar.
Two separate ex-Baltic deals have surfaced today, November 14, with the HMS I/II 80:20 scrap prices at $356/mt CFR. One of the deals which was reported to be for the Iskenderun region was denied by the supposed seller, who also said that the second deal had not taken place. However, market sources believe that $356/mt CFR and even lower prices for ex-Baltic scrap are currently acceptable to Turkish producers.
Yesterday, an ex-Bremen booking by a Marmara-based producer was heard for HMS I/II 80:20 scrap at $356/mt CFR. The supposed buyer rejected this information. An ex-Netherlands deal to the Marmara region with HMS I/II 80:20 scrap at $353/mt CFR was rejected by the reported seller. Again, with the euro losing strength, market sources think that European scrap suppliers are ready to accept the levels in question. According to Turkish producers, offers from the EU have declined to $355/mt CFR and slightly below. Under the current conditions, SteelOrbis has revised its reference price for ex-EU HMS I/II 80:20 scrap to $353-354/mt CFR.
Several transactions from France have been shared by market players. The first was rumored to have been signed by an Izmir-based producer for 5,000 mt of HMS I/II 80:20 scrap at $350/mt CFR, but was denied by the supposed buyer. A second one was heard to have been done by another Marmara-based mill for 10,000 mt of HMS I/II 80:20 scrap at $351/mt CFR, and this deal is believed by most market players to have been actually done though it has not been officially confirmed. Both tonnages indicate that these deals, even if done, cannot be considered deep sea bookings. A market player dealing with material of this origin said that the prices in the rumored ex-France deals are now unworkable and that prices will move down in the next deal.
Under the current conditions, SteelOrbis’ reference price for ex-US HMS I/II 80:20 scrap has been reduced to $360-361/mt CFR. Market sources report that there is silence in the local US scrap market and players are still monitoring the settlement of prices for the November buy-cycle. With Trump re-elected, he is expected to focus on tariffs and tax cuts as a means to make America more competitive on the world stage as he transitions back into office following a period of extreme steel price volatility combined with recent high inflation following the Covid-19 pandemic.
Today, a German sub-collector reported that EU-based export yards are bidding €295/mt DAP for scrap, though the price is weak, commenting, “They bid €295/mt DAP today, but they also informed us that the price can move down quite fast. An export yard said they may cut prices by €5/mt tomorrow. There is no demand for scrap in the domestic market. Even the producers we usually work with are getting ready for an early holiday season. Hence, scrap flow is directed to exports, exerting pressure on prices.” Meanwhile, exporters are not receiving strong demand from alternative scrap buyers. Trade activity in the import scrap market in Pakistan has remained subdued as most Pakistani producers have been refraining from new purchases given low finished steel demand and rather high inventory levels. Import scrap prices in India have been pushed up by sellers, but no deals have been confirmed in the market amid uncertain finished steel prices, the lower capacity utilization rates of secondary mills, and the local currency touching a historical high against the US dollar, further increasing the landed price of imports. As a final note, as of today Turkish domestic rebar spot prices have decreased by TRY 400-500/mt ($11-15/mt) week on week. Accordingly, 12 mm rebar spot prices in Turkey have settled at TRY 24,600-25,200/mt or $597-611/mt ex-warehouse, depending on the region, at an exchange rate of $1 = TRY 34.36. The workable rebar prices in the Marmara and Izmir regions vary at $600-610/mt ex-works, including prices from Icdas A.S., for cash payment only.