Turkiye: Imported scrap prices rise slightly w-o-w even as weak steel demand weighs on bookings

The Turkish imported scrap market remained moderate as only a limited number of new deep-sea contracts were reported. Producers delayed scrap purchases amid unfavourable conditions in the finished steel sector.

Negotiations in the ferrous scrap segment paused, as price expectations between buyers and sellers diverged. Turkish steel-makers focused on sluggish longs sales and aimed to secure only essential scrap volumes.

Turkish rebar was available at prices ranging from $570 to $575/t FOB for October shipment. Price adjustments were possible with firm bids, although export demand remained minimal. Sales in the domestic rebar market in Turkiye were also heard to be limited and in small volumes between $575-$580/t ex-works.

Turkish steel mills continued to restock imported scrap. Three US deals were disclosed, including one from an Iskenderun-based steelmaker for mixed cargo and two from mills in the Marmara region. Despite restocking, steel mills were cautious about selling finished steel, resulting in no urgent rush to cover sales. Mills were reluctant to accept HMS (80:20) offers above $380/t CFR in the current import cycle due to narrow production margins.

Recent deals:

• A US supplier sold to an East Marmara-based mill HMS(80:20) at $377/t with Shredded and Bonus at $397/t on a CFR basis.
  
  
• An Aegean mill secured Europe-origin HMS (80:20) scrap at $365/t with bonus scrap at $385/t CFR.
  
  
• Acquired HMS (80:20) from the Baltic region at $372/t with bonus scrap at $392/t CFR.
  
  
• A Mediterranean mill purchased 10,000 t of US-origin HMS (95:5) scrap and 20,000 t of bonus scrap at an average price of $395/t CFR Turkiye.
  
  
• West Marmara-based mill procured US-origin shredded scrap at $397/t CFR and HMS (80:20) at $377/t CFR.
  
  
• Another Aegean mill secured EU-origin HMS (80:20) scrap at $365/t CFR.
  
  
• A Turkish mill secured US-origin HMS (90:10) scrap at $383/t, marking a $1/t increase from the previous deal with the same US supplier.
  
  
• A US supplier sold to a Mediterranean region mill at $377/t for 18,000 t of (80:20) scrap and $397/t for 12,000 t of shredded scrap on a CFR basis.
  
  

In contrast, the shortsea market witnessed Romania-origin offers declining to a range of $350-$355/t CFR, while bids were reported at $345/t CFR. This indicated a temporary slowdown in short sea market activity.

Domestic steel market

Domestic rebar prices from other Turkish steel producers remained relatively unchanged. Mills hesitated to lower prices despite slow sales due to high production costs. In the middle of the week, Turkish integrated steel producer Kardemir decreased its local rebar prices and managed to place orders for sufficient volumes of the material despite the generally weak market. Other mills have kept their local and export rebar prices stable. On 13 September, Kardemir opened a new round of rebar sales for local clients. The company lowered its price to $581/t (TRY 15,656/t) exw, down $14/t (TRY 377/t) since the previous trading campaign that took place on 23 August. The offered price was quickly accepted by the market, so the producer was able to sell 35,000-40,000 t of the product and close the round in less than an hour, with hopes of more scrap bookings amid rebar sales.

Habas proceeds with steel plant construction

Habas, a major Turkish long steel, and HRC manufacturer has obtained environmental approval for its additional Izmir-based rebar and wire rod mill. Construction has commenced, with the project expected to be completed by the end of 2024.

Auto sector

The Turkish automotive segment experienced a slowdown in production figures due to annual leave and maintenance at major players' assets. While this narrowed the positive balance over the eight months on an annualised basis, 2023 performance continued to outperform last year's figures. In August, total automotive output declined by 21.2% y-o-y, primarily reflecting slower passenger car production.

Outlook: Given the current market situation there is no urgent buying expected as demand for longs remains low, and limited availability is expected to contribute to strong imported scrap prices with some stability in prices expected in the short term. Meanwhile, the export market of rebar might see some fluctuations as per currency rate movements.