Turkish scrap slides amid more offers

Posted on 29 November 2021

The number of scrap offers increased in the Turkish market on Friday. Although no bookings were heard, a few suppliers confirmed sales without giving price and composition details.

A Baltic-supplier tells Kallanish: “I have sold my cargo for early-January shipment. However, I am unable to provide further details as I promised to keep the booking confidential. There are a few more bookings that are kept confidential in the market.”

Although no official confirmation has been obtained, there are rumours that those bookings from the Baltic were concluded at $488-490/tonne cfr Turkey for HMS 1&2 80:20. 

While most market participants think scrap prices will slide further amid a higher volume of offers and competitive billet prices, some suppliers are expecting to see a recovery in scrap prices.

One supplier says: “I am quite optimistic. Another week of positive trend in China is likely to pave the way for Turkish exports. On the other hand, the approaching winter and holidays will keep scrap supply tight. This may cause scrap prices to recover.”

A mill, however, says: “Turkey’s scrap demand is likely to fall amid decreasing utilisation and high volatility in exchange rates. I don’t see an upward trend in scrap prices as likely. On the contrary, a downward trend is more likely to me.”

Another producer said on Friday: “Suppliers have been advertising the tightness of scrap until this week. However, we have seen many offers return to the market. On the other hand, billet prices at $650/t cfr are more competitive compared to scrap. These will increase the pressure on scrap prices.”

Ex-EU and UK suppliers have decreased their price targets and are being more aggressive in the Turkish market, with the advantage of having weaker domestic currencies.

Most market participants found prices over $482-485/t cfr and $488-490/t cfr for HMS 1&2 80:20 from the EU/UK and Baltic respectively unworkable on Friday. Their price idea for US-origin HMS 1&2 80:20 is at below $493/t cfr. “Only cargoes that contain higher shredded and/or bonus may get a $1-2/t premium as Turks are mostly inquiring about higher-quality cargoes,” says a Turkish mill.

Turkish wire rod exports, meanwhile, are yet to recover on limited demand. Although a Turkish mill managed to sell 10,000 tonnes of wire rod to Peru at $640/t fob Turkey, demand in other destinations remains weak. Offers for mesh-quality rod are seen mostly at $810-835/t fob, though higher offers are also available from producers that are longer utilised.

Source : Kallanish