Turkiye: Imported bulk scrap prices fall by $3/t w-o-w amid ample supply

• Weak demand, high costs keep market uncertain
  
  
• HMS collection prices at docks remain elevated
  
  

Turkish deep-sea imported ferrous scrap prices fell by $3/t w-o-w, as mills refrained from restocking inventory due to weak demand for long products.

Mills continued to seek discounts due to insufficient demand for long products, but sellers were not eager to lower their prices due to high costs. The disparity between bids and offers also put pressure on sellers, further contributing to the downtrend and market uncertainties.

Market activity was subdued due to the winter, with material flows slow. Mills will soon need to start purchasing for February, but with an abundance of material available, prices are expected to remain stable.

Suppliers highlighted difficulties in meeting the lower price targets set by Turkiye-based buyers, mainly because of persistently high HMS collection prices at the docks.

An EU-based recycler stated, "With weak demand in Turkiye, it is unlikely that prices will rise. It is difficult to meet the mid-$330/t CFR target with the current collection prices. Recyclers will likely need to reduce collection costs."

BigMint's assessments

• US-origin HMS (80:20) bulk scrap was at $343/t CFR Turkiye, down $3/t w-o-w.
  
  
• Bulk HMS (80:20) from the US East Coast stood at $319/t FOB, also down $1/t w-o-w.
  
  

The scrap-to-rebar spread remained range-bound w-o-w at $222-225/t, as rebar export prices stood at $565-570/t FOB.

Market scenario

Despite the challenges, two sell-side sources were optimistic. A US-based recycler expected prices to recover to $350/t CFR, while a Baltic-based recycler predicted that there would be greater price stability. The seller's target for Baltic material was $348-349/t CFR.

Turkish mills submitted lower bids to recyclers, with $330-337/t CFR for EU-origin material and $340/t CFR for US-origin material, the latter of which was rejected. Low bids were common this week, as mills sought to pressure sellers, taking advantage of the surplus of unsold cargoes in the market. The strategy helped buyers gauge sellers' reactions and secure lower prices amid weak demand.

A Turkish mill participant stated, "A price of $340/t CFR for US/Baltic-origin material seems reasonable, while prices under $335/t CFR are suitable for EU material." However, with low demand and market uncertainty, it is unclear whether sellers will accept these levels.

A US-based recycler commented, "The domestic market in the US seems positive right now," referring to their expected workable level of over $346/t CFR.

Outlook

The market remains uncertain, with a US recycler observing that it is difficult to gauge current trends. Similarly, an EU recycler highlighted that it is too early in the week to predict how conditions will develop.