Turkiye: Imported ferrous scrap prices fall in recent deal

After the earthquakes that devastated southern Turkiye and northern Syria, Turkish import scrap purchasers and steelmakers limited their trading operations. Few bulk cargo bookings from the US took place this week.

On the other hand, three key mills made force majeure announcements and temporarily halted transactions following the natural calamity. Customs clearance in Iskenderun has been put on hold, and as of 10 February, deliveries to the steel plants have been temporarily stopped.

Due to erratic gas supplies and lack of labour, steel production has been challenging. Moreover, the lack of demand from the mills in Iskenderun could put pressure on import prices. Nonetheless, cargo discharge would shortly start again.

"Everyone is watching the Turkiye market closely and waiting for further clarity about price direction; a further decline in pricing is anticipated," a Turkish steel mill source said.

SteelMint's daily assessment for HMS 1&2 (80:20) from the US stood at $415-420/t CFR Turkiye, down significantly by $10/t w-o-w.

The Turkish lira was largely stable and was trading at 18.8 against the dollar from 9 February.

Recent trades

• Recently, two bulk cargo deals were heard from Europe which were traded at $417/t for HMS (80:20) to East Marmara and Black-sea region-based mills.
  
  
• A bulk cargo containing HMS (80:20), shredded and bonus was booked by a mill in the West Marmara region late last week at $418/t and $438/t CFR Turkiye, respectively.
  
  
• Another cargo containing HMS (80:20), shredded and bonus was sold to a Marmara-based mill at $413/t and $433/t CFR Turkiye, respectively.
  
  

Turkiye's automotive production up y-o-y: Turkish Automobile Manufacturers' Association (OSD) data show that automakers produced 111,837 units in January, an increase of 23.6% from the same month last year. Production of passenger cars increased by 48% to 70,723 units. Stronger international demand also helped producers, as exports increased by 16.9% y-o-y to 79,381 units (out of which 51,122 units were passenger cars). Imports increased by 61.2% to 34,291 units.

Domestic market overview

• Rebar prices decline on lower demand: The earthquakes that happened last week continue to impact the Turkish long steel market. For domestic buyers, ICDAS announced a $10/t reduction in rebar prices. Rebar is currently available from the producer at $710/t exw Biga. Nonetheless, the ex-Marmara price remained at $735/t CFR due to logistical issues.
  
  
• Domestic scrap market steady: Sources informed that Turkiye's scrap market has remained steady. Participants in the local market are wary of the downward trend in the price of imported scrap and have chosen to wait and see.
  
  

Outlook
The nation's demand for steel might rise due to reconstruction work and more iron scrap is produced in earthquake-prone areas, but it is anticipated that steel production, transportation and trading may remain suspended for the next two to three weeks.