DAILY STEEL SCRAP: Export rebar demand may revive deep-sea imports soon

Turkish steel producers started to look for scrap cargoes at the end of this week after the latest downturn in prices and a revival of demand for long steel products in Southeast Asia, market sources said on Friday March 26.

With news of a UK-origin cargo sold at $410 per tonne cfr on an HMS 1&2 (80:20) basis, the daily scrap indices plunged by around $24 per tonne on March 25.

But several steel mills have been heard to resume their rebar sales to Southeast Asia in the past few days, which encouraged the mills to book deep-sea scrap for April-May shipments.

A steel mill in the Marmara region was heard selling at least two rebar cargoes, while another mill in the same region sold four cargoes.

The prices of these rebar cargoes were $610 per tonne fob last week, and $620 and $625 per tonne this week, on an actual weight basis, market participants said.

“Demand in Southeast Asia is recovering with the help of a downward correction in freight costs,” a Turkish mill source said. “Suddenly, Turkey had a chance to export rebar. The mills came to the [deep-sea scrap import] markets to check available cargoes. However, suppliers have mostly withdrawn and started to look for higher prices.”

Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), export, fob main port Turkey, was $610-620 per tonne on March 25, down from last week’s $620-630 per tonne fob.

“Suppliers in the United States are offering [HMS 1&2 (80:20)] at $420-425 per tonne cfr, but the mills may buy at $410-415 per tonne if they can continue to sell rebar to Southeast Asia,” the mill source added.

A trading source agreed, saying: “The prices of scrap will probably increase next week if the mills in Turkey resume their bookings.”

“I think US prices will be in the range of $410 and $415 per tonne cfr on an HMS 1&2 (80:20) basis,” another trader added. “Turkish mills still need cargoes for late-April and May shipments.”

Demand for short-sea scrap was already recovering, Fastmarkets was told.

“The Turkish steel producers were interested in short-sea scrap, while they were keeping their deep-sea bookings slow,” another Turkish mill source said. “I heard two steel mills booked Bulgarian and Romanian cargoes [on Friday]. It seems we are now at the bottom for the deep-sea market. I expect that Baltic Sea- and US-origin cargoes will be priced around $415 per tonne cfr on an HMS 1&2 (80:20) basis.”

As a result of the latest offers, bids and assessments, the daily scrap indices remained fairly stable at the end of the week.

Fastmarkets’ daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was calculated at $404.60 per tonne on Friday, down by only $0.06 per tonne day on day.

And the daily index for steel scrap, HMS 1&2 (80:20 mix), US origin, cfr Turkey, was $413.96 per tonne, also down by $0.06 per tonne day on day, leaving the premium for US material over European scrap at $9.36 per tonne on March 26.