US: Ferrous scrap export index remains largely stable amid election outcome

• Suppliers wary amid election results, expect prices to rise
  
  
• Turkish demand cools, European offers lower than US ones
  
  

The US ferrous scrap export index was largely stable w-o-w, primarily due to weakened demand from Turkiye as prices have likely bottomed out there. US scrap was priced higher than that of Europe, which dampened demand from Turkish buyers for US material.

FOB assessments

• BigMint's assessment for HMS (80:20) bulk FOB US East Coast remained unchanged w-o-w at $337/tonne (t) on Friday.
  
  
• BigMint's assessment for shredded bulk FOB East Coast also remained stable w-o-w at $357/t on Friday.
  
  

CFR assessments

• Weekly assessment for US-origin HMS (80:20) bulk scrap was at $362/t CFR Turkiye, stable w-o-w.
  
  
• Weekly assessment for deep-sea bulk US cargoes of HMS (80:20) CFR Vietnam stood at $372/t, up by $6/t w-o-w.
  
  
• Weekly assessment for US-origin HMS (80:20) bulk prices were at $380/t CFR Chattogram, up $1/t compared to last week.
  
  

Market overview

US sellers are beginning to hold back, hoping that the presidential election's outcome will drive the market higher. President-elect Donald Trump's pro-protectionist stance may reduce the availability of material for export. As a result, suppliers are in a "wait-and-watch" mode, awaiting market direction before taking further action.

Additionally, the euro's depreciation against the US dollar limited European scrap price increases. With the weaker euro, Baltic recyclers may sell scrap at over $362-363/t CFR Turkiye.

Insiders indicate that demand for ferrous scrap remains weak in key buyer markets such as Turkiye, India, and Bangladesh, which has put pressure on seaborne prices.

The US Federal Reserve cut interest rates by 25 basis points to 4.50-4.75% recently followed a 50 basis point cut two months ago, beginning a cycle of rate cuts.

Market sentiments

Turkiye: Turkish import prices of US ferrous scrap moved within a narrow range over the week, with a drop towards the second half of the week. Ultimately, prices settled at the same level as last week's. The market is in a "wait-and-watch" mode, which is expected to limit near-term price hikes.

US suppliers cautiously raised offers after the election outcome. While the US domestic market's positive sentiment supported higher prices, Turkish mills were reluctant to make purchases at these levels, due to weak domestic rebar demand and declining sales.

Notably, around 4-5 bulk scrap cargoes were booked from Europe. As the exchange rate continues to fall, it will enable European suppliers to reduce their offers or at least keep them stable. US offers may be influenced by the competitive pricing of European suppliers.

Bangladesh: Demand for US-imported scrap in Bangladesh remained weak, with bulk offers from the US largely considered unviable.

A trader commented, "We are currently opting for small bulk shipments from nearby regions, as US bulk offers above $390/t are not feasible."

A representative from a leading Bangladeshi steelmaker stated, "US domestic scrap prices are expected to rise under Trump, supported by stronger sentiment in the US steel industry. However, China will face challenges, which could lead to further declines in Chinese finished steel prices."

Outlook