European scrap import/export contracts from France and Germany into Italy and Spain for June are in the process of closing with a €10/tonne ($11.2/t) reduction compared to May, as expected. However, not all contracts have been signed and some may be agreed at -€5/t depending on quality, traders and merchants tell Kallanish.
Ferrous scrap export contracts are agreed towards the middle of each month. “Italian mills are working at reduced capacity at the moment because final demand for long products on the domestic market remains rather patchy and the market is uncertain,” an Italian trader comments. A French merchant says a similar situation of demand is registered in Spain where rebar prices and sales are not particularly lively. However, Spanish mills are requesting lower-quality scrap compared to Italian mills.
New arisings mixed quality E8 from France and Germany into Italy is in the process of reaching €270/t for the lower quality and €280/t delivered on average for the higher grade, Kallanish hears. Import/export contracts will be closed this week.
The scrap market in Europe remains uncertain and is following the downward trend of Turkish scrap. “However, it is possible that mills will resume purchasing higher scrap quantities by mid-July to replenish their stocks before the August summer closures in France, Spain and Italy. This may trigger some mild increases next month,” a source comments.