Turkey: Imported scrap prices rally as buyers conclude active deals from Europe

Global scrap prices set a new high as Turkey (a major scrap importer) booked its recent deals at increased levels. Prices of Turkish imported scrap have surged further after buyers closed deals with European suppliers. Negotiations are taking place for fresh cargoes. Suppliers are looking for opportunities to keep raising their offers, as mills have a requirement for material, as Turkey mostly imports scrap from the US and Baltic region, SteelMint learnt.

Additionally, the ongoing war between Russia and Ukraine has affected the Turkish steel sector while domestic prices are moving up significantly on a d-o-d basis on lower availability.

SteelMint's assessment of US-origin HMS 1 & 2 (80:20) prices increased to a multi-year high of $650/t CFR Turkey, up by $50/t w-o-w. The prices are hovering at their highest since 2010, as per data maintained with SteelMint.

Recent deals recorded by SteelMint

Turkey's domestic market follows uptrend

• Lira depreciates further against dollar: The Turkish lira continued to decline against the dollar amid acceleration in geo-political events. Currently, the lira is being traded at 14.7 against the dollar in the currency exchange market.
  
  
• Uptrend continues in local scrap: Turkish steel producers have announced a further hike in their domestic scrap purchase prices, following the trend of imported scrap as well as finished steel and semis.
  
  
• Domestic billet jumps up sharply: Domestic billet prices witnessed a sharp jump recently. Additionally, mills received a positive response from customers in domestic and overseas markets, and active bookings are being registered at high prices. Some mills have set billet offers at $880/t exw-levels, registering a sharp hike of around $100/t in a few weeks' time.
  
  
• Domestic longs prices move up in Turkey: Turkey's major steel producer ICDAS announced another price rise in its domestic rebar. The company's rebar offers have risen by $130/t w-o-w to $940/t exw-Biga and $951/t CFR Marmara. The sharp hike in prices is a result of the continuing Russia-Ukraine political crisis.
  
  
• Downtrend in Turkish auto sales: The second sequential fall in domestic sales of the automotive sector is a result of increasing prices. Besides, the persisting electronic components crisis and lack of adequate stimulus for new purchases have added to the hike in vehicle prices, according to Automotive Distributors' Association (ODD). Automobile sales decreased by 17.9% to 29,020 units in Jan'22 y-o-y, while the light commercial vehicles market increased by 8.9% to 9,111 units.
  
  

Outlook: Market sources expect more price hikes soon as US and Baltic suppliers are targeting higher than $670-680/t CFR for HMS 1&2 (80:20) material.