Turkiye: Imported scrap trade activities muted on negative market sentiments

The imported scrap market remained quiet in Turkiye this week. Negotiations between suppliers and buyers have slowed down. Mostly buyers have opted to wait and watch for clearer market direction to emerge as the finished steel market is yet to improve. Also, buyers are not in a hurry to book fresh slots as the steel market remains muted.

Meanwhile, buyers and steel mills may look for some discounts for November shipment bookings. However, suppliers are unlikely to quote fresh offers at lower levels and are holding offers.

SteelMint’s assessment for US-origin HMS 1&2 (80:20) stands at $365/t CFR, unchanged w-o-w.

One deal was heard concluded by a Turkish mill for HMS 1&2 (80:20) at $371/t CFR from a supplier in the Netherlands for prompt shipment. Taking into account the absence of fresh deep-sea contracts, however, the deal remained unconfirmed till the time of publishing this assessment.

Negative domestic market sentiments

• Lira maintains stability: The national currency, Lira, remained largely unchanged against the dollar last month. It is currently trading at 18.6 against the week back. 
• Billet market remains slow: Trade activity remained weak in the domestic billet market. Weak demand in the longs segment is less likely to support domestic sales. Steel producers are offering billets to local customers at $630-635/t exw versus $630‑650/t exw a week ago. Overall, the market is silent.
• Rebar prices remain under pressure: Steelmakers continued to revise their prices lower due to inadequate demand in the local market. The country’s integrated finished steel producer, Kardemir, announced new prices for the domestic market. The prices have been set at $685/t exw. ICDAS kept its prices at $690/t exw Biga and $701/t CFR Marmara, down significantly by $30/t w-o-w.
• Mills expect further hike in energy prices: Despite the huge 50% hike in gas and electricity prices in September, Turkish steelmakers are expecting a further hike in gas and electricity prices, which put additional pressure on them to reduce other costs including domestic scrap. Increased input costs have slowed down market activities, and mills are likely to cut production, while a few mills have already halted operations. 

Outlook: The imported scrap market is likely to see a spurt in activity for November shipments as suppliers are holding offers now. However, suppliers may quote fresh offers soon.