Posted on 23 Oct 2019
Having concluded numerous scrap bookings in previous weeks, Turkish mills have started this week observing the market.
While sentiment is not negative – there are still some mills with inquiries – most mills have backed off, initially to gain some more certainty about the market. The uncertainty over the Turkish military ceasefire in Syria, withdrawal of US sanctions against Turkey, and a Brexit deal agreement still affects the market. On the other hand, the high number of deep-sea scrap bookings in recent weeks allows mills to relax for a while and not hurry with new bookings.
Due to high demand for billet, specifically in Asia and China, in previous weeks, there is a shortage in billet supply as well as short-sea scrap supply. Considering that deep-sea and short-sea HMS I/II 80:20 prices stood at $242-244/t cfr and $235/t cfr respectively in the latest bookings last week, the price difference between these two sources has narrowed significantly.
Kallanish observes there is much speculation over new bookings in Turkey’s scrap market. A European supplier and Turkish mill each denied having concluded a HMS I/II 80:20 cargo at $251.5/t cfr on Tuesday. New deep-sea and short-sea quotes for HMS I/II 80:20 mostly stand at $247-250/t and $238-240/t cfr respectively. An ex-US supplier is offering HMS I/II 90:10 at $255/t cfr.
On Tuesday a Turkish mill determined billet and rebar sales prices at $385/t and $420/t ex-works respectively. Rebar stood at $406/t ex-works on its previous price list released on 8 October. Rebar prices in İskenderun are even higher. Due to the lack of billet in the market and increased scrap prices, long steel prices in Turkey are rebounding.
Although Kallanish expects to hear further scrap bookings this week, the number of these bookings is predicted to be less than last week.
