NEW YORK Prices for bulk ferrous scrap exports to Turkey gained a few dollars this week as Turkish mills returned to the market to fill inventories.
At least seven bulk cargoes have sold to five Turkish producers since March 7, with the United States accounting for three of those sales and the United Kingdom and continental Europe booking two each.
A sixth Turkish producer has yet to announce the result of a March 12 tender, which many sources believe was won by a British exporter.
U.S. East Coast exporters had sought much larger price increases, with offers reported in a range of $405 to $415 per tonne c.i.f. Turkey for an 80/20 mix of No. 1 and No. 2 heavy melt.
However, the three U.S. bulk sales to Turkey concluded over the past few days fell short of that range, with up to $4-per-tonne increases in delivered prices, according to several market sources.
A closer look at the sales reveals a sideways move on an f.o.b. basis due to increased bulk freight costs, according to some sources.
One bulk cargo of about 40,000 tonnes was booked out of the Gulf Coast March 7 at $408 per tonne c.i.f. Turkey for HMS 1&2 (80:20), with shredded scrap at $413, and plate and structural scrap at $418, market sources said. The price was about $3 per tonne higher than the last Gulf Coast bulk sale concluded by the same exporter in late February. However, bulk freight rates have risen by nearly the same amount since that sale, one source said.
A second bulk sale was concluded off the East Coast, with around 20,000 tonnes of HMS 1&2 (80:20) and 10,000 tonnes of shredded scrap sold at an average price of $406 per tonne, sources said.
A third cargo to Turkey from the East Coast, booked by a broker in the third week of February, was at an average price of $405 per tonne for 35,000 tonnes of HMS 1&2 (90:10) and 5,000 tonnes of plate and structural scrap, according to a second source. That price is about $5 higher than the brokers original buying price.
"I guess European HMS 1&2 (80:20) must be today max between $390 and $395," the source said. "(The) market is losing its heat, (and) $390 to $395 is only mathematic. (The) Turks will step out again and next prices will be lower. (The) goal is $380."
Despite exporters apparent inability to score larger price increases, there could still be some hope for them, a third source suggested.
"My gut feeling is that for the short term, the tug-of-war might be won by the (United States)," he said. "(The U.S. utilization rate) is improving month on month, and scrap collections are still short. The increment in dock pricing has not been reflected on f.o.b. export prices yet."
Trading slowed during the first week of March and only gained momentum after U.S. domestic markets settled late last week, according to a source in Turkey.
"It started very slow," he said. "There were only rumors that U.S. market prices would be higher than $400. There was no seller in the market shopping around. On March 7, mills started to check the availability of sellers."