ANKARA: The Turkish market for imported scrap rose sharply Monday, as US and Baltic merchants secured stronger prices over the weekend and coking coal continued to soar. Three trades hit the market Monday, both likely done over the weekend. There was a booking reported from an Izmir-based electric arc furnace producer at $259.25/mt CFR for the heavy melting scrap I/II (80:20) portion, from a premium US East Coast seller. This represented the first US-origin sale registered by S&P Global Platts since mid/late-October. A Baltic merchant also sold to another mill in Izmir at $260.50/mt CFR, after a premium US sale was reported into the western Mediterranean region at $260/mt CFR Friday. The same US supplier had reportedly rejected a bid at $258/mt CFR from a Turkish producer at the end of last week.
A European merchant also sold HMS I/II (75:25) to an Izmir-based producer at $247/mt CFR, with the shred/bonus portions indicating a price of $255/mt CFR on an 80:20 basis. Platts daily assessment of Turkish premium deepsea HMS I/II (80:20) imports moved $7.50/mt higher Monday to $260.50/mt CFR.
There was talk of a Benelux-based merchant selling to a large Marmara-based EAF, but this could not be confirmed. It was clearly fast becoming a sellers’ market, as merchants tried to leverage the expensive blast furnace-based route for stronger scrap prices — coking coal surged by over $20/mt Monday, the largest daily jump in almost six-years, on continued Chinese short-supply. “Suffice it to say, not seeing any kibosh on Turkish trading activity thus far,” one large European seller said by email. Platts published an article Friday suggesting political and macroeconomic factors had deterred dealmaking in the world’s largest market for imported scrap.
The lira initially firmed Monday morning — after its rout Friday — with people citing S&P Global Ratings upgrading the country’s economic outlook from negative to stable. But the currency retraced those gains later, to reach another record low against the dollar. But sellers seemed in no rush to move material, given the clear upward momentum in the market.
Tonnage has tightened considerably since an overhang in the US pushed 80:20 beneath $210/mt CFR towards the end of September. In the US, prices strengthened throughout the November buy-week, with mills paying up $40/lt by the end of next week. Mills still in the market this week seeking scrap are looking at even higher pricing offers from scrap suppliers.
On the demand side, higher coal and iron ore prices have made other metals more expensive and pushed global mills that may use sponge iron among other material to charge more for scrap — Indian mills have been more active in the bulk market, for example, as have some in the GCC. On the London Metal Exchange’s scrap contract, December traded at a strong $285/mt CFR Monday, while The Steel Index’s underlying reference price finished at $255/mt CFR.
