SteelMint learned in recent conversation with market participants that demand for imported scrap has remained decent for remaining February shipments in Turkey. Steel mills have continued procurement at increased prices in a recent lot of fresh bookings. Prices have increased by USD 5-6/MT against the last report on Monday. With this, prices have hit 2-month high as these levels were last seen towards the end of Nov’18.
In the recent trade, a steel mill in the Iskenderun region booked a US cargo comprising 30,000 MT HMS 1&2 (80:20) at USD 310/MT, CFR Turkey for February delivery.
Another US cargo was booked by a Marmara region based steelmaker comprising HMS 1&2 at USD 310/MT, CFR.
A German recycler heard to have sold a 30,000 MT March shipment cargo to Izmir region based steel mill comprising 25,000 MT HMS 1&2 (80:20) at USD 305/MT and 5,000 MT Bonus scrap at USD 315/MT, CFR.
A Baltic origin cargo sold to the Marmara based steel mill comprising 25,000 MT HMS 1&2 (80:20) at USD 307/MT and 5,000 MT Bonus at USD 317/MT, CFR. While another cargo sold comprising HMS 1&2 at USD 308/MT, CFR however, the details of the trade were not available at the time of publication of this article.
According to SteelMint’s price assessment, US origin HMS (80:20) scrap climbed to USD 309-310/MT, CFR Turkey as against USD 302-304/MT, CFR in the last report at the beginning of the week. While HMS 1&2 (80:20) of Europe origin stands at around USD 300-302/MT, CFR. A premium for US material over Northern European scrap stands at around USD 8-9/MT.
After Turkish rally of scrap bookings the supply side has turned very tight, in line with this, the severity of winter weather in the US and Europe remained very high this may put upward pressure on global scrap prices on continuous demand. Jump in futures of Iron ore in China could also increase demand for scrap in the near terms.
Increase in Rebar offers might support margins – Following higher scrap costing but no strengthening of rebar market, the spread between exports rebar and imported scrap had dropped to quite a lower levels putting steel mills under pressure. Few steel mills may cut production if overseas demand is not improved in the near terms. The rebar melting margin stands at around USD 140-150/MT and Export offers stand in the range USD 435-445/MT, FoB, however, limited buying interest seen at these levels. Rebar export offers have inched up against last week.
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