Turkish scrap falls further, rebar demand remains concern

Posted on 01 June 2018
 

Source: Kallanish

Turkish mills have booked five deep-sea scrap cargoes this week following the three purchased last week, with prices inching down further. The worrying state of Turkey’s economy is likely to maintain downward pressure on scrap prices in the near term, market participants tell Kallanish.

Following a UK-origin cargo booked at the end of last week at $333/tonne cfr Turkey for HMS 1&2 80:20, Turkey has booked two Baltic-origin, two European-origin and one UK scrap cargo this week. The latest Baltic and European cargoes – the latter from the Benelux – had HMS 80:20 priced at $331/t, while the UK cargo priced HMS 80:20 at $331.5/t.

Turkish mills have maintained rebar export quotes at $545/t fob Turkey actual weight, with no sales heard this week. Weak local market demand is also of concern. “There is a deathly silence,” says one Iskenderun-based trader. “The local market has no movement.”

At this week’s Bureau of International Recycling (BIR) convention in Barcelona scrap merchants told Kallanish they are counting on the recovery of Turkish scrap purchases. “We all need Turkey,” was one European merchant’s comment on the situation. US suppliers are less reliant on Turkey as they have alternative markets to sell to, such as Latin America, Asia and the Middle East, a US-based merchant pointed out. Nevertheless, the weak Turkish market is still likely to impact US domestic scrap prices in June, he added.

The BIR’s ferrous division board president Tom Bird said during the convention that although steel demand is healthy across most regions, Turkey is “… the elephant in the room.” The lira devaluation, steel export issues and the state of Turkey’s economy are of concern, he added. Some Turkish mills could halt production after Ramadan if sales do not improve, commented Frank Heukeshoven of Germany’s TSR Recycling.

    



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