DAILY STEEL SCRAP: Suppliers withdraw offers after sharp spike in prices

The Turkish deep-sea scrap import market went quiet after the sharp increase in prices following China’s cancellation of export tax rebates on some steel products, market participants said on Tuesday May 4.

China’s Ministry of Finance removed the export tax rebate on some steel products on May 1.

The news boosted demand for steel and, in particular for steel billet, in Asia, and that triggered the rush to book more scrap in Turkey at the end of last week.

The most recent deep-sea transaction was recorded on Friday April 30, when a steel mill in the Iskenderun region booked a European cargo, comprising 20,000 tonnes of HMS 1&2 (80:20), 8,000 tonnes of shredded, 10,000 tonnes of bonus and 2,000 tonnes of busheling at an average price of $453 per tonne cfr.

At the end of last week, market participants estimated the price of HMS 1&2 (80:20) at about $448 per tonne cfr, which led to a near $22-per-tonne increase in Fastmarkets’ daily scrap indices.

Scrap suppliers withdrew their offers following the sharp rise in prices and demand and only two suppliers were active in the market on Tuesday, sources said.

A Baltic Sea supplier was heard offering a cargo at $465 per tonne cfr, while a supplier from the United States was offering HMS 1&2 (80:20) at $462 per tonne cfr.

“The scrap merchants are mostly worried. We cannot offer material, as it is not clear where the market is heading,” a trading source told Fastmarkets.

Another source said: “There is almost no scrap on offer in the market. We expect prices to reach to $475 per tonne cfr and above on an HMS 1&2 (80:20) basis.” 

And a Turkish mill source agreed.

“The prices skyrocketed everywhere after the news from China to remove the tax rebate. There are no scrap offers in the market [and] I think the scrap prices will soon exceed $470 per tonne cfr,” the source said

As a result of the fresh offers and estimates, the daily scrap indices edged up further on Tuesday May 4.

Fastmarkets’ daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was calculated at $450.58 per tonne on Tuesday, up by $2.11 per tonne compared with Friday’s index.

And the daily index for steel scrap, HMS 1&2 (80:20 mix), US origin, cfr Turkey, was calculated at $455.34 per tonne on May 4, up by $0.90 per tonne day on day.

This put the premium for US material over European scrap at $4.76 per tonne on Tuesday, compared with $5.97 per tonne on Friday April 30.

What to read next
The new US trade tariffs threaten the fragile global trade balance and risks reigniting inflation.
Access our expert insights into the outlook for the Asian paper packaging market in 2025, including insights into the projected growth in containerboard demand across the region.
United States President Donald Trump signed an executive order to implement tariffs on imports from Mexico, Canada, and China on Saturday February 1, sparking swift retaliation and sending world trade into uncharted territory.
Critical minerals sector braces for policy upheaval under Trump while experts predict market fundamentals and Republican state interests will preserve industry momentum
Learn about the impact China's consumer products trade-in program has had on packaging demand, with the policy set to continue in 2025.
The weaponization of critical minerals supplies due to trade tensions could lead to the kind of emergency that would provide the push that the US needs to develop its metals and mining sector, the chief executive officer of Alaska Energy Metals has said.