Imported scrap offers rose slightly this week in a recently-concluded deal. Prices have moved up owing to scarcity of material and high offers gaining acceptance. Buyers and steel mills were mostly out of the market for two weeks due to low finished steel trades in the domestic and overseas markets.
Negotiations remained slow as buyers adopted a wait-and-see approach. Mills kept rebar prices stable as they have low margins and cannot reduce prices despite almost zero demand.
Recent deal
A US-origin 45,000 t bulk cargo was booked by a West-Marmara based steel mill. The cargo comprised 19,000 t of HMS (80:20) booked at $402/t CFR, while 21,000 t of shredded was booked at $422/t. 5,000 t of bonus was booked at $422/t CFR Turkey. The cargo is scheduled for September shipment.
SteelMint’s price assessment for US-origin HMS 1&2 (80:20) stood at $400-402/t CFR, inching up on the week.
Market overview
- Local scrap prices down: Turkish steelmakers revised domestic scrap purchase prices amid weak finished steel demand. A majority of Turkish steel producers announced a decrease in their purchase prices for domestic scrap. The reason behind the downward trend was the unfavourable situation in the finished long sector. Other companies keep their scrap prices unchanged.
- Billet market waits for clearer trend: Business activity in the billet segment remained slow this week in Turkiye. Subdued demand for finished and semi-finished long steel slowed down refilling stocks in domestic mills. Market participants are waiting for a clearer picture for the billet market. Domestic mills are offering to local consumers at $610-630/t exw.
- Rebar market sentiments negative: Business activities remained subdued in the domestic rebar segment as both domestic and overseas buyers are not in a hurry to book significant volumes at current prices. Turkiye’s long steel producer, ICDAS, kept prices at $670/t exw Biga and $681/t CFR Marmara, unchanged over the last few weeks. Offers from other mills have also been broadly stable at around $660/t exw. Negative sentiment prevails in the market as there is no trade activity and producers cannot lower their prices amid high input costs.
- Auto production surges 37% in July: Although the global automotive industry continues to suffer from insufficient electronic component supply, Turkish carmakers have posted a positive performance in July. Domestic auto giants produced 93,659 units in July, an increase of 37.4% y-o-y compared to 68,167 units in July 2021, according to the Turkish Automotive Manufacturers’ Association (OSD). Passenger car production rose by 41.5%, y-o-y, to 51,243 units in July.
Outlook: The Imported scrap market is yet to gain momentum as very limited deals are happening. Subdued finished and semi-finished steel demand continues to keep buyers on the sidelines.
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