NEW YORK A fresh round of
higher-priced bulk ferrous scrap export sales from the East
Coast to Turkey has placed a more positive spin on near-term
Uncertainty still pervades the
market on where export prices are expected to land in late
January, but an increase in selling prices for three cargoes
sold late Tuesday and Wednesday has brought some positivity,
A U.S. exporter sold two bulk
cargoes of 45,000 tonnes each to a single consumer in Turkey
late Tuesday at $391 per tonne c.i.f. for an 80/20 mix of No. 1
and No. 2 heavy melt scrap, AMM has learned.
Each cargo will reportedly carry
about 30,000 tonnes of HMS 1&2 (80:20), 10,000 tonnes of
shredded scrap and 5,000 tonnes of plate and structural scrap.
The shredded portion sold at $396 per tonne, while plate and
structural sold at $401 per tonne, sources said.
On Wednesday, a few sources
reported that the same exporter had sold another bulk cargo
from the East Coast to a different consumer at $393.50 per
tonne for 30,000 tonnes of HMS 1&2 (80:20). The cargo will
also reportedly carry 10,000 tonnes of shredded scrap sold at
$5 above the heavy melt price.
Buyers for mills in Turkey have
now indicated there could be a few more trades before
"(Previous trading at) $410 per
tonne was too high and the market reacted. Then we saw $380s,
and have now reached the $390 level. This means the market is
accepting this level. Scrap is still relatively short, domestic
prices are still reasonable, so at the end $390 seems (to be)
the settlement level," one source in Turkey said.
"It seems that prices are
increasing," one exporter said. "The main reason seems less
supply these days. European scrap sellers are very quiet
because (of currency) exchange rates. On the other hand, due to
winter conditions, Black Sea scrap supply will be limited in
the coming days."
Several other sources agreed
that weather is supporting stronger prices as the market
anticipates tighter scrap flows due to cold conditions.
But a scrap buyer for a second
producer in Turkey suggested prices have strengthened purely
due to a need to fill inventories.
Prices are rising a little, but
there is "nothing supporting it," he said. "Turks didnt
buy for a while, so they had to buy. There will be more trades
Market conditions for Turkish
long products are still negative, another source said, but they
are better for flat steel products. Prices were up because U.S.
exporters succeeded in taking them up, not because of improving
market conditions, he said.
A fifth source said he
didnt fully agree with market speculation of a
longer-term softening in tags.
"In my humble opinion, and from
what we see in the U.S., a short for January delivery would be
a risky position. A bulk of the cargo overhang has been cleared
and it is starting to be winter," he said. "Shred feed is tight
and margins for this grade are marginal at best. Despite the
scrap billet spread, I see Turkey hitting $400 before we see a
drop, which I would look to see mid-February or March."
Meanwhile, sources reported a
few smaller-volume trades out of Romania and Russia to
different Turkish mills.
One mill reportedly bought about
20,000 tonnes of bonus-grade scrap from three suppliers in the
region at an average price of $402.50 per tonne, while an
exporter there sold smaller vessels carrying 3,000 to 7,000
tonnes of heavy melt to three other Turkish mills in a range of
$380 to $381 per tonne.