Turkish scrap market anticipates further falls
Trading activity in Turkey’s scrap market continues to remain lacklustre. Mills are gradually decreasing finished steel prices but this is failing to spur sales. This, coupled with lower Russian billet offers, is seen preventing Turkish producers from buying scrap.
There are numerous scrap suppliers in the market. Premium and European HMS 1&2 80:20 suppliers are seen targeting to sell at last week’s prices of $480/tonne cfr and $465-470/t cfr Turkey respectively. Mills, however, no longer find these levels workable.
One Turkish mill source tells Kallanish: “$460-465/t cfr could be workable for premium HMS 1&2 80:20 but I am not sure if other mills are bidding at these levels. Most producers’ purchasing appetite, including ours, is quite weak under the current market conditions.”
Another mill, however, does not find a price above $450/t cfr workable from any origin. A trader agrees and adds: “It could be maximum $5-10/t higher [than $450/t for mills to consider purchasing], depending on the cargo composition.”
A deep-sea scrap supplier says: “I wouldn’t be surprised to hear an EU-origin HMS 1&2 80:20 deal at below $450/t this week. I don’t see or expect any improvement in Turkey’s scrap demand this week. Pressure on suppliers is climbing. There are multiple suppliers that need to sell urgently.”
Another supplier says the market is heading towards a collapse. “We have never seen halts this long in scrap purchases. Although Turkey needs to buy scrap, stagnant finished steel sales prevent mills from seeing ahead. Production stoppages or lower utilisation may come onto the agenda.”
Some short-sea suppliers from Bulgaria are meanwhile heard to have accepted to sell at $400/t cfr Turkey.
Almost all Turkish mills further decreased their domestic scrap buying prices on Tuesday, meanwhile. However, a slight recovery has been seen in shipbreaking scrap buying prices, which fell to $405-420/t on Monday and then rebounded to $405-430/t delivered on Tuesday.
Finished steel sales in both domestic and export markets remain sluggish. Some Turkish producers decreased their domestic rebar prices to $755-760/t ex-works. Although the lira’s weakening has brought some activity, it remains limited.
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Anonymous
Very good overview of the weekly steel market.
Anonymous