Posted on 03 Jun 2019
Turkish scrap import prices dropped back down last week as the optimism surrounding the US’ reduction of duty on Turkish steel subsided quickly. Mills held rebar export quotes steady and at least one sale was concluded to Southeast Asia despite subdued buying interest there, market participants tell Kallanish.
Following a Baltic-origin deal with HMS 1&2 80:20 priced at $306/tonne cfr Turkey and US-origin cargo with HMS 1&2 90:10 at $313/t booked at the start of the week, a Europe-origin deal took prices down further. This was confirmed at 25,000t of HMS 80:20 at $302/t and 5,000t bonus at $312/t. This came after US material had leaped to $313/t the previous week as many people became excited in anticipation of the resumption of Turkish rebar exports to the US.
These exports are yet to materialise; however, scrap suppliers did very well to exploit the surge in optimism after the US duty reduction, sources say. One Turkish scrap agent exclaims: “It was a good opportunity to make money!” A European scrap collector says: “I am still trying to figure out where the uptick came from in the first place. I mean, I get that the US reduced its duty, but it’s still 25%.”
There was a rebar booking reported by one trader to have been done to the US at $675/t cfr duty paid, netting back to around $480/t fob Turkey, taking into account the US 232 tariff and rebar anti-dumping duty. However, this was not verified by other market participants.
One Turkish mill did, however, confirm a 20,000t rebar cargo sale to Singapore, concluded on an fob basis at $480/t fob Turkey. This was despite renewed bearishness in the Southeast Asian market following the fall in scrap prices.
Turkish mills held rebar export quotes at $480-485/t fob, although traders said $475/t was available.
The Turkish market will be closed this week for the Bayram holiday, another factor along with already-weak domestic steel consumption that is expected by some to drag scrap back below $300/t. “Everybody is already in holiday mood,” a Turkish scrap agent said of last week’s business.
