Turkiye: Imported scrap prices edge up on improved trades

The uptrend in imported scrap prices continued in Turkiye after the recent round of deals got concluded. Although activities remain slow in the Turkish rebar sector, steel producers kept on buying imported scrap lots. Demand for scrap is higher than its availability, and so suppliers are taking advantage of low availability to keep offers high.

Steel producers have been forced to procure scrap at higher prices to maintain average stocks of raw materials for smooth production and better capacity utilisation is likely to ultimately narrow operational costs.

Alternatively, they are considering billet imports along with ferrous scrap, as it is a better option to roll out finished products. Turkiye is one of the leading exporters of rebar and producers had to plug backlogs as a few sources shared that mills were holding lower rebar stocks.

Interestingly, Turkiye's yearly average rebar exports stood at 7.69 million tonnes (mnt) from 2017 to 2021 out of total finished long steel exports of 9.562 mnt, i.e. over 80%.

SteelMint's assessment for US-origin HMS 1&2 (80:20) stands at $380-385/t CFR, moving up by $20/t w-o-w.

Recent deals

Despite the significant drop in prices at the beginning of the month due to weak demand in the finished steel market, in the second half of November prices rebounded due to low availability.

Domestic market recovers

• Lira maintains stability: The Turkish national currency, Lira, has maintained stability for yet another week in the exchange market for the last two months. It is currently at 18.6 against the US dollar.
  
  
• Local scrap prices rise: Domestic scrap prices are moving up in line with tight overseas price trends and domestic scrap sellers have strengthened their offers to get better utilisation resulting in better bids from the domestic market.
  
  
• Billet prices move up: The continued upward trend in ferrous scrap, which has resulted in bullish trends in the finished long steel market, has also touched the Turkish billet market. However, semi-finished steel buying remains modest so far.
  
  
• Rebar prices edge up: Domestic finished steel producers have increased rebar prices amid the non-stop uptrend in imported scrap prices. However, trading activities remain far from the desired level in the local market.
  
  

ICDAS, a major producer, announced a significant increase in its rebar offers. The company has raised rebar prices by $20/t to $690/t ex-Biga. Offers from other Turkish steelmakers are at $670?690/t exw depending on the region.