Turkey ferrous: Price flat, China rebar rise continues

The Turkish scrap import price was flat today as deep-sea scrap suppliers showed little willingness to accept premium HMS 1/2 80:20 equivalent prices below $475/t cfr.

The Argus daily HMS 1/2 80:20 cfr Turkey steel scrap assessment was flat at $477.50/t cfr.

Several deep-sea scrap suppliers will be motivated to make sales next week based on August shipment availability and their ability to collect HMS 1/2 80:20 material throughout this week at prices around €12-20/t lower in European and Baltic countries.

Those sellers should keep Turkish scrap import prices relatively depressed throughout next week but mills are also going to see next week as a buying opportunity based on the sustained increase in Chinese domestic rebar prices. Some deep-sea scrap suppliers will likely be in relatively expensive stock positions having collected some HMS 1/2 80:20 for August shipment at €355/t and €360/t delivered to dock in Baltic and continental European regions, respectively.

Lower Chinese steel output planned for the rest of the year is set to impact global rebar prices and put China firmly out of the seaborne export picture. If availability of deep-sea scrap dries up in August, scrap prices will likely revert to following steel trends and move upward.

But if US supply to Turkey remains strong, Turkish mills may widen their scrap-export rebar margins further in August and the full extent of any steel-driven scrap price recovery will be curbed. Premium HMS 1/2 80:20 prices at $485-490/t cfr Turkey for example will likely become attractive to US exporters if August domestic delivery prices in the US fall $20-30/gt from July, as some market participants expect.

Asia-Pacific steel prices rose further as the trend of China controlling crude steel output became more and more influential, Asian market participants said. Market sentiment was boosted further today on discussion that the China Iron and Steel Association (Cisa) held meetings today to request steelmakers commit to solid production reductions for the remainder of the year to meet China's zero growth goal.

The China steel industry carbon-to-peak roadmap is also expected to be released soon. China's carbon emissions from its steel industry will peak at 1.758bn t in 2025 and decrease gradually to 544mn t by 2060, according to estimates from the China Centre for Information Industry Development (CCID), backed by Ministry of Industry and Information Technology (MIIT).

Shanghai mainstream rebar prices rose today by another Yn50/t to Yn5,300/t on rising futures. October rebar futures rose by 2.2c to Yn5,671/t. Bullish sentiment prevailed in the market with most participants believing steel supply will shrink over the remainder of this year. Around 20 Chinese mills increased rebar and wire rod ex-works prices by Yn20-60/t today.

In the short-sea Turkish imported scrap market, the Argus daily A3 cif Marmara steel scrap assessment was flat at $447.50/t.