Turkey ferrous: Price down as global scrap demand rises

The Turkish scrap import price edged down today as mills lowered bid indications, but availability fell on multiple sales by deep-sea scrap exporters to other destinations.

The Argus daily HMS 1/2 80:20 cfr Turkey steel scrap assessment moved down $2.50/t to $425/t cfr on Thursday.

Turkish mills largely remained out of the market although they are expected to purchase cargoes tomorrow if they have not already done so today. Bid indications fell to around $420/t cfr in order to target purchases in the mid-$420s/t.

Turkish mills' purchase of large deep-sea volumes for May shipment at the beginning of this month has allowed them to stay out of the market this week in an attempt to drive down prices in the face of strong offer availability. One deep-sea scrap supplier sold four cargoes to three Turkish mills in the space of four business days, finishing the fourth trade on the first day of this week.

A total of 22 cargoes are recorded traded for May shipment into Turkey now, with the total estimate expected to be around 27 cargoes. This leaves them with around 15 cargoes to buy for May shipment.

But that previously plentiful scrap availability is falling because of active demand from several other importing geographies, including regions that very rarely buy bulk material.

A US supplier sold a mixed cargo to an Egyptian mill at an average price of $436/t cfr yesterday. The mill was heard to buy a second US cargo although no details could be retrieved. Two continental European suppliers also sold a mixed cargo each to a second Egyptian mill, in one case for very prompt shipment. Three other Egyptian requests were still being negotiated today, including two from one mill that is very likely to purchase UK scrap.

A bulk cargo was heard sold today from the US to Taiwan, which primarily purchases only containerised or coaster shipments from the US and Japan respectively. Bulk availability is limited in southeast Asia region and several continental European and UK suppliers have received requests from Vietnam, potentially in response to current high Japanese export prices and strong Chinese demand for Vietnamese semi-finished steel. A deal may have concluded from the UK or continental European mid-week into Vietnam, market participants said.

Deep-sea sales appetite into Turkey is not strong relative to Turkish mills' price expectations in the mid $420's cfr. The scrap sellers known to still be looking to sell to Turkey today do not sell to alternative markets and tend to be more impacted by periods of weaker Turkish demand.

Chinese domestic and export rebar prices increased strongly today and the export steel opportunities for Turkish mills remain significant. One Marmara mill was heard to sell material mid-week at $650/t fob to central America, equivalent to a base price of around $637/t fob based on a $13/t premium for the added manganese/vanadium content.

The announcement today that Turkey's Central Bank will keep interest rates unchanged provides little scope for lower lira-denominated local steel prices – the lira stood at around TL8.1:$1 as Argus went to press today, similar to the level it ended yesterday evening – but it at least provides some near-term balance to the Turkish economy, sources said.

In the Turkish short-sea imported ferrous scrap market, the Argus daily A3 cif Marmara steel scrap assessment was flat at $407.50/t cif.