DAILY STEEL SCRAP: Prices down almost $10 per tonne in latest US deal

Turkish steel producers resumed their deep-sea scrap bookings when buying a US-origin cargo at a lower price than in other recent deals, market participants told Fastmarkets on Wednesday May 26.

A Turkish steelmaker booked the US cargo, consisting of 44,000 tonnes of HMS 1&2 (95:5) at $515 per tonne cfr.

The most recent deep-sea transactions were done at the end of last week.

A steel mill in the Iskenderun region booked a mixed cargo from Europe at an average price of $516 per tonne cfr. The equivalent price of the cargo for HMS 1&2 (80:20) was calculated at $510.00-510.50 per tonne cfr.

Another steel mill in the same region booked a UK cargo consisting of HMS 1&2 (80:20) at $513 per tonne and shredded at $528 per tonne cfr.

US-origin scrap usually trades at a premium over EU- and UK-origin material.

As a result of the lower price in the latest transaction, the daily scrap indices went down sharply on May 26.

Fastmarkets’ daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was calculated at $503.64 per tonne on Wednesday, down by $9.82 per tonne day on day.

And the corresponding daily index for steel scrap, HMS 1&2 (80:20 mix), US origin, cfr Turkey, was $508.22 per tonne on May 26, down by $9.81 per tonne day on day.

This put the premium for US material over European scrap at $4.58 per tonne on May 26, compared with $4.57 per tonne on May 25.

The reason for the decline in the indices was the downturn in Asian steel prices, market sources said.

Fastmarkets’ weekly price assessment for steel billet, import, cfr China, was $700-720 per tonne on May 21, down from $770-800 per tonne a week earlier.

“The steel prices in Turkey are following the trend in China, because one of the main export destinations for Turkey is Asia. Turkish mills have already reduced their rebar export offers to $760 per tonne fob today,” a Turkish mill source said.

Fastmarkets’ latest weekly price assessment for steel reinforcing bar (rebar), export, fob main port Turkey, was $780-790 per tonne on May 20, narrowing upward from the previous week’s $740-790 per tonne.

At the same time, there was talk of a US cargo being sold at $515 or $525 per tonne cfr on an HMS 1&2 (80:20) basis. But market participants believed that this price was now too high for Turkish steelmakers.

“A US supplier was offering a cargo at $525 per tonne cfr for HMS 1&2 (80:20), but nobody would pay that today. You would be lucky if you could sell at $505 per tonne cfr now,” a trading source said.

“A steel mill in the Izmir region was seeking a cargo,” another trading source said, “but I don’t think they would pay even $515 per tonne at the moment.”

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