- Limited supply, high freights increase scrap tags
- Mills increasingly opt for local scrap, billets
Turkish deep-sea bulk ferrous scrap prices rose by $2/t w-o-w, following recent US-origin deals and higher negotiation levels for European scrap. Scrap suppliers were firm on their offers and refused to budge from these values. As a result, some producers continued to accept higher scrap prices despite weak finished steel demand in Turkiye.
According to BigMint’s bulk scrap trade tracker, five deals were concluded in the last seven days – majority from the US and Europe – at $353-363/t CFR Turkiye.
BigMint’s price assessments
- US-origin HMS 80:20 bulk scrap stood at $361/t CFR Turkiye, up $2/t w-o-w.
- Bulk HMS 80:20 from the US East Coast was at $339/t FOB, also up $3/t w-o-w.
According to market participants, workable prices for Baltic-origin HMS 80:20 were at $362-363/t CFR. Some Baltic recyclers remained optimistic, citing increased finished steel demand in Europe. “EU mills are boosting collection, but scrap supply to yards is limited.”
Recent deals
- US-origin to Aegean region: HMS 80:20 at $362.5/t.
- UK-origin to Aegean region: HMS 80:20 and bonus priced at $356.5/t.
- Russian-origin to East Marmara region: HMS 80:20 at $353/t.
- US-origin to Mediterranean region: HMS 80:20 at $362.5/t and shredded and bonus at $382.5/t.
- EU-origin to West Marmara region: 40,000 t of HMS 80:20 and shredded/bonus at $355.5/t and $375.5/t, respectively.
Market scenario
The price increase was driven by firm supplier positions, limited availability, and rising freight costs. A seller-side participant stated that they are “targeting over $370/t CFR for HMS 80:20 amid strong domestic prices, while European sellers are aiming for $360/t CFR and higher.“
Seller-side sentiment stayed strong, while Turkish mills faced challenges in preserving margins due to high scrap prices.
A Turkish trader noted, “Turkish import prices lagged behind domestic HMS prices in the US. A feasible selling level for US-origin HMS 80:20 was above $362.5/t CFR.”
A Turkish mill source stated, “A $360-365/t CFR range is feasible, pushed by rising US market prices. However, rebar demand remains sluggish, and with soaring scrap costs, profitability or margins are simply unattainable.”
A market participant noted, “With the sell side maintaining its stance, price expectations remain elevated, driven by strong domestic US ferrous scrap prices.”
Domestic market
“Mills are increasingly opting for local scrap and billet purchases, as high import prices, coupled with weak finished steel demand, continue to squeeze margins,” a market participant observed.
In the second half of February, several Turkish mills raised domestic scrap purchase prices by TRY 100-700/t ($3-19/t) to secure local supply amid strong import prices. This move was made to reduce costs, as high imported scrap prices and weak finished steel demand squeezed margins.
Some Turkish mills kept local scrap prices unchanged, but further depreciation of the lira caused their dollar-based quotes to drop by $3/t w-o-w.
Outlook
US ferrous scrap prices are set to rise in March, as mini-mills boost output amid tight supply. Turkiye’s imported scrap prices may stay firm due to strong supplier positions, but weak steel demand could limit buying. Mills may adjust domestic sourcing to offset high import costs.
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