The global benchmark for scrap has continued to rise during the last two months, after registering a huge drop in mid-August. The Kallanish index for HMS 1/2 imported into Turkey returned last week at $335/t cfr, a level close to the annual 2018 average so far and over $30/t above the bottom reached in August this year.

The latest recovery confirmed that despite the persistent issues for Turkish steelmakers, the global scrap market remains in good shape thanks to healthy levels of demand in the world. It also indicates that Turkish mills are not in the position to drop much further their finished steel prices going forward.

As reported, Turkish mills are facing difficulties in exporting their products due to rising trade barriers across the globe. The problems in the export market are being exacerbated by the relatively weak demand seen in the domestic market, where the economy is suffering from the latest political and monetary issues.

Various participants at the Kallanish Euro-Turkey Flat Steel Seminar in Istanbul last week said they expect steel demand in Turkey to recover in the second quarter of 2019. However, some argued this would not happen until 2020 as construction activity is likely to remain impeded by reduced public investment.