Posted on 04 Dec 2019
HMS I/II 80:20 scrap prices having reached $272/tonne cfr with a sharp rise at the end of last week, are seen to have recorded another firm increase today with a fresh Baltic origin booking.
A Baltic-origin cargo was confirmed by an integrated Turkish mill at $280/t for 24,000 tonnes of HMS ½ 80:20 and $290/t for 3,000t bonus, for January shipment.
Although there is demand for January shipment scrap cargoes in the Turkish market, the number of offers seems to be limited as many suppliers have backed-off.
Many scrap suppliers which are aware of the need for Turkish mills’ January shipment purchases are seen to have been unable to meet Turkish mills’ demand and price expectations. This is due to the tightness of scrap they can source ahead of holidays.
On the other hand, Turkish mills, especially long steel producers, are seen to be resisting $280/t cfr prices. This is because they are unable to sell rebar at their offer levels and are consequently forced to lower rebar prices. Flat steel producers, however, are seen to be more comfortable with higher scrap prices.
“I am unable to comment any more. I was expecting new deals at $275/t cfr. There is really no logic in this business. My only explanation for such a sharp increase is the seasonal factors and flat steel market situation,” a Turkish rebar producer tells Kallanish.
In the short-sea market, last week’s deals were concluded at $260-262/t cfr, with Russian suppliers out of the market. Although no new deals are heard yet this week, the next sales prices are predicted to stay at $270/t cfr levels due to high demand from Turkish mills for short-sea scrap.
Turkish mills that have already reflected higher scrap prices in the local rebar market are also expected to increase fob prices. However, while current offer levels have failed to find buyers, it is questionable whether higher rebar quotes will gain acceptance in export destinations.
imported scrap prices in Turkey are expected to remain strong in the short-term. This is because US scrap prices are expected to settle at least $20/t higher and the current upward trend in European scrap prices is continuing. Scrap demand this week from Turkish mills for January shipment cargoes is also supporting Turkish imported scrap prices.
