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Bulk scrap exports sideways as demand slips

Keywords: Tags  ferrous scrap exports, export prices, Turkey, China, South Korea, scrap, AMM Index, ferrous scrap Sean Davidson

NEW YORK — U.S. ferrous scrap export prices for bulk shipments trended sideways over the past week as thin demand offered little price support.

A big return to the scrap market by Turkish mills did little for East Coast exporters, who booked just two of 11 bulk sales to Turkey this past week, with European exporters picking up most of the business.

Market participants said a strong dollar—which makes European scrap more attractive—and a relatively strong domestic market for scrap meant U.S. offers failed to trigger much interest from Turkey.

U.S. offers trended anywhere between $405 and $410 per tonne c.i.f. Turkey, but the two sales made in the middle of last week concluded at prices slightly lower than the offer levels.

A smaller vessel carrying up to 30,000 tonnes traded at an average price of $406 per tonne for 20,000 tonnes of an 80/20 mix of No. 1 and No. 2 heavy melt and 10,000 tonnes of shred, sources said.

A larger 40,000-tonne vessel was sold by a broker to a Turkish mill at $404 per tonne for 35,000 of HMS 1&2 (90:10) and $412 for 5,000 tonnes of plate and structural scrap.

The sales prices were slightly above the last East Coast sale booked at $401 per tonne for HMS 1&2 (80:20) at the end of February, but higher freight costs negated the increase for scrap valued on an f.o.b. basis, according to several sources.

As a result, AMM’s weekly East Coast Ferrous Scrap Export Index settled March 18 at $375.58 per tonne f.o.b. New York, down just 18 cents from the previous week.

"The market here didn’t change a lot," said one source in Turkey. "We are not seeing any demand (for finished product) nowadays. As well as the domestic market being slow, export markets are not doing any good, either. It seems like Turkish mills will have a hard time increasing product prices."

On the West Coast, sources reported only one bulk sale, which concluded early last week to South Korea at around $425 per tonne c.i.f. on an HMS 1&2 (80:20) basis. However, bids from Chinese and Korean mills have since dropped by $10 to $15 per tonne, creating a fresh stalemate in exports last week (, March 15).

"There is little interest right now as the rebar price has dropped and there is adequate scrap in the pipeline," said one West Coast exporter.

A source in China said bids were down significantly for iron ore and scrap.

"I think the market is searching for new balance," he said. "We also heard there will be no more business for Korean buyers."

AMM’s West Coast Ferrous Scrap Export Index settled Monday at $380.83 per tonne f.o.b. Los Angeles, up 35 cents from $380.48 per tonne the previous week.

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