Turkiye: Imported scrap prices remain soft w-o-w amid dull response from steel mills

Turkish deep-sea scrap prices remained under slight pressure as mills showed reduced activity after last week's booking campaign, with no new deals confirmed after last weekend. While 15-18 deals were reported until then, the market is awaiting further developments as Turkish buyers' interest diminishes.

HMS (80:20) prices are at around $425/t CFR for Baltic and US cargoes, and market participants expect a subdued week considering many mills have already secured cargoes for January.

Slow scrap flow and weak appetite suggest minimal price movement this week, with uncertainty about Turkish buyers returning to support higher prices.

Domestic ferrous scrap prices in Europe increased in December due to a sharp rise in the benchmark Turkish import scrap market in November. Northern Europe's domestic shredded scrap was assessed at Euro 365/t delivered to the mill during the first week of December, marking a Euro 20/t increase compared to a month ago. Despite this, some sources considered the settlement modest compared to the surge in bulk seaborne HMS (80:20) prices into Turkiye.

The scrap-to-rebar spread was assessed at $180/t as export offers for rebar hovered around $605-610/t on a FOB basis.

SteelMint's assessment for US-origin HMS (80:20) bulk scrap stands at $425/t, reflecting an increase of $8/t w-o-w. The price, which reached $430/t on Monday, has softened by $5/t since then.

Domestic market: Turkiye's domestic scrap prices continued their anticipated upward movement this week, supported by strong seller-side sentiment in the import segment. Midway through the week, many Turkish steelmakers increased their purchase prices for local scrap by TRY 250-360/t, with the US dollar equivalent adding $8-12/t. The upward trend is attributed to robust import scrap prices and the growth in Turkish-finished steel products. Some mills kept prices unchanged, but a slight weakening of the lira impacted dollar-based quotes for some companies, reducing them by $1/t.

Turkish finished steel sales faced challenges at current levels, leading mills to likely maintain prices without further increases. Turkish exported rebar was assessed at $605/t FOB, with limited sales activity reported despite offers between $610 and $630/t FOB. The recent steep hike in scrap prices, driven by tight availability and higher collection costs, could result in possible losses for sellers.

Kocaer Steel secures major export order: Izmir-based merchant bar and section producer, Kocaer Steel, is strengthening collaborations with overseas customers, receiving an order for steel profiles worth nearly $22.4 million from Europe and the Americas. The order, focused on high-value-added energy sector profiles, follows last week's partnerships with MENA region clients, totalling around $23 million. Kocaer, a major steel profile exporter in Turkiye, operates three facilities with an annual capacity of 800,000 t, serving diverse sectors globally including energy, transportation, shipbuilding, and agriculture. These strategic moves are expected to enhance the company's overall turnover.

Kardemir rebar offers: In a separate update, Turkish producer Kardemir has revised its price list for rebar and wire rod. Rebar sizes ranging from 12 to 32 mm are now at TRY 18,335 ($631)/t, reflecting an increase from the end of November's rate of TRY 17,125 ($592)/t. Additionally, wire rod prices have seen a $10/t increase, with the 5.5 mm SAE 1006 grade at $660/t EXW and SAE 1008-1010 grades at $650/t exw.

Outlook: The Euro's fluctuation against the dollar may soften European offers for ferrous scrap to Turkiye. While minimal deals are expected, the market is anticipated to stabilise in the near term. The US market could continue to trigger bullish sentiment in Turkiye, following stalled price negotiations for December-delivered volumes.