Turkiye: Imported scrap prices drop $2/t w-o-w; weak rebar demand weighs on trade

• Turkiye’s central bank reduces benchmark rate to 40.5%
• Domestic rebar weak, shortsea market improving gradually

Turkiye’s deep-sea imported ferrous scrap prices slipped slightly by up to $2/t w-o-w, as market activity remained limited. US sellers continued to stay out of the market, focusing on domestic demand, while other exporters were hesitant to offer.

No major deals were reported in the past seven days.

Sources indicated that there were a few US sellers around, but a lot of European supply. Freight and the EUR/USD rate are really killing the business, sources said. Current ideas hover at $345/336/330/t for US/Baltic/EU origins.

Price assessments

• US-origin bulk HMS 80:20 was assessed at $342/t CFR Turkiye, down by $1/t w-o-w.
• Bulk HMS 80:20 from the US East Coast stood at $311/t FOB, a decrease of $2/t w-o-w.

The Turkish rebar-to-scrap spread remained at $192-194/t, with workable rebar offers at $530-540/t exw, slightly lower than last week’s $540-550/t.

Market updates

Tradable values for HMS 80:20 were reported as tradable at $340-345/t CFR, while EU-origin material was assessed at $332-338/t CFR.

As per a Turkiye-based trader source, offers were heard in the $335-345/t range, but there was too much manipulation in the market.

A trader commented, “Some sellers who recently completed deals are now cautious due to currency fluctuations, rising freights, and limited collection. However, some participants expect demand to recover soon.”

Domestic market

In the domestic market, the longs market remained weak. Prices fell due to low industrial demand, traders’ reluctance to restock, and persistently high production costs.

Market insiders said both domestic and export sectors for steel remain weak, and bureaucrats are only making things tougher. Low demand, sluggish finished steel sales, high collection costs, rising rates, and freight are weighing heavily on sentiment.

Turkiye’s central bank cuts rates

Turkiye’s central bank reduced its benchmark rate to 40.5% from 43% in its second consecutive cut, citing easing inflation. Annual inflation eased to 33% in August from over 75% in mid-2024, while Q2 GDP rose 1.6% q-o-q.

Outlook

Interest in shortsea cargoes is rising, with HMS 80:20 tradable at $310-315/t CFR. While the market isn’t fully active yet, gradual improvement is seen, with some suppliers targeting Egypt and Morocco over Turkiye. However, Turkiye’s demand outlook remains soft in the near term.