NEW YORK U.S. East Coast ferrous scrap bulk exporters continued their stalemate over new price levels with buyers for Turkish mills, rendering the market inactive.
Exporters and offshore consumers waited patiently for U.S. mills to settle their buying programs for October (amm.com, Oct. 2). When domestic trading was complete, offshore consumers learned that U.S. steel mills in markets that ship both domestically and abroad had indeed followed the recent drop in export tags but hadnt exceeded it.
In crucial supply markets, such as the Mid-Atlantic region, exporters and domestic mills are now competing head to head for key grades like heavy melt and shredded scrap.
Fledgling sales to the Middle East and other foreign markets for Turkish steel producers, along with rising energy costs in Turkey, are forcing buyers to find some reprieve from raw material costs, according to several market participants.
But U.S. exporters looking to secure large volumes of scrap for the flurry of bulk orders booked in mid- to late September and scheduled for delivery in late October and early November have refused to budge from the last transaction price of $365 per tonne c.f.r. for an 80/20 mix of No. 1 and No. 2 heavy melt scrap.
As a result, no bulk cargoes were booked from the United States, and Turkey instead turned to Europe to secure scrap.
"U.S. sellers were not very aggressive last week. Price indications from the U.S. were not below $365 per tonne," one source said.
"Turkey is not ready to pay at this level because the rebar (price) was on the way up from $580 to $595 levels, but it stopped and started to go down to $580," a second source said.
"The market collapsed in Turkey this week," according to a third source.
"In (one Turkish region), some mills stopped their production for a while. It is my opinion that the market could be going into a crisis like 2008. The difference between 2008 and now is that in 2008 Turkey had foreign markets like the Middle East to sell products to. But now the Middle East is also not in a good condition due to the wars everywhere," this source added.
The lack of activity in the U.S. and Turkish scrap markets left AMMs East Coast Ferrous Scrap Index unchanged Monday at $340.89 per tonne f.o.b. New York for HMS 1&2 (80:20).
On the West Coast, only one source reported a bulk cargo sale. That sale, concluded late last week, went to Vietnam at $380 per tonne c.f.r. for HMS 1&2 (80:20), with shredded scrap trading $5 higher.
While at least one source in the region suggested the cargo might have traded previously, a source familiar with the deal said it took place last week.
The lone sale sent AMMs West Coast Ferrous Scrap Index down Monday to $334.81 per tonne f.o.b. Los Angeles, a 0.9 percent decline from previous levels (amm.com, Oct. 1).