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Turkiye: Imported scrap prices fall by $7/t w-o-w as mills lower bids amid weak steel demand

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Melting Scrap

BigMint Bureau

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14 Nov 2024, 19:58 IST

Turkiye: Imported scrap prices fall by $7/t w-o-w as mills lower bids amid weak steel demand

Recent EU deals have lowered expectations for prices

Mills remain cautious, await stronger steel demand

Turkish imported ferrous scrap prices have fallen by $6-7/t w-o-w mainly due to recent European shortsea and deepsea bookings along with lower buyer-side market levels.

Trading has been quiet, as Turkish mills are waiting for demand to pick up before making more purchases and quoting lower bids at around $350-355/t.

Price assessment

BigMint's assessment for US-origin HMS (80:20) bulk scrap stood at $358/t CFR, down by $7/t w-o-w.

BigMint's assessment for bulk HMS (80:20) from the US east coast stood at $334/t FOB, down by $5/t w-o-w.

The scrap-to-rebar spread remains range-bound at $230-235/t as rebar export prices stood at $585-590/t FOB.

The weakening Euro has further lowered European scrap prices, with collection costs at Euro 286-290/t ($301-$306/t) delivered to the dock.

The current dock price stands at around Euro 290/t ($306-308/t), with the Euro nearing a two-year low against the USD. EU dockyards anticipate low-priced deals to Turkiye at $350-355/t, with a few unconfirmed transactions reportedly aligning with these workable levels, according to an EU dockyard owner.

Romanian shortsea prices could dip further, with expectations around $342-345/t CFR Turkiye, another Turkiye-based trader informed.

Two recent short-sea deals from France included 10,000 t of HMS (80:20) at $351/t and another deal for 5,000 t of HMS (80:20) at $350/t on a CFR Turkiye basis.

The Baltic and US markets remained stable, with no discounts reported as market participants assessed the impact of the US election outcome.

A European recycler informed, "Turkiye is not rushing to pay higher prices. We hope for a modest recovery, maybe around $10/t." He added, "There is resistance from buyers, with customers aiming to keep prices within the $350-360/t CFR range."

Negotiations are progressing slowly, as divergent trends in raw material and finished product prices are reducing customers' interest in replenishing stocks with imported scrap.

Around 3-4 deals were heard in the last seven days majorly from the EU region between $356-363/t and one from the US at $362/t CFR Turkiye.

No US-origin scrap offers were reported this week, but sell-side indications ranged between $364-367/t CFR Turkiye.

Turkiye's real estate market saw a robust recovery in October, with house sales rising 76.1% y-o-y and 17.2% m-o-m to 165,138 units, according to TUIK. Istanbul led with 24,812 units, followed by Ankara and Izmir. Mortgaged sales surged 278.2% to 21,095 units, while other sales grew 63.3%. First-time sales increased 97.3%, and resales rose 66.5%. Favorable mortgage terms and relatively affordable housing supported this growth. Cumulative sales for the year reached 1.11 million units, up 11.9% y-o-y.

Kaptan Demir Celik, a leading Turkish rebar producer, plans to invest TRY 429.6 million ($12.5 million) in a 37.31 MW solar power plant in Van province. The project will cover 36.7 ha and include 63,778 panels, generating 63.4 GWh annually. Construction will take six months after receiving permits. This is part of Kaptan's broader expansion plan to increase crude steel output to 3.1 million tpy and rolling capacity to 2.9 million tpy, up from 1.4 million tpy each.

Outlook: The imported ferrous scrap market in Turkiye is expected to remain steady within a limited price range. The Turkish steel market is likely to remain cautious, as mills are dissatisfied with current rebar sales. According to other sources, the supply side is well-stocked with sufficient bulk scrap cargo, which is why the price outlook remains subdued and not particularly bullish.