NEW YORK The result of a bulk scrap tender released March 25 by a Turkish mill is expected to set the tone for this weeks U.S. and European export prices to the worlds largest scrap-importing nation.
U.S. exports to Turkey all but dried up about two weeks ago after Turkish mills stormed several markets to cover inventory positions for April (amm.com, March 18).
At the time, a weaker euro and stronger U.S. domestic market had Turkish steelmakers turning to British, European and Black Sea shores for a majority of their purchases.
On March 25, several market participants said conditions hadnt changed much since, with U.S. offers reportedly at around $403 to $405 per tonne c.i.f. Turkey last week for an 80/20 mix of No. 1 and No. 2 heavy melt and Turkish mill bids at anywhere between $395 to $400 per tonne, according to a scrap buyer for one Turkish steel producer.
But sources speculated that Turkish mills will need to step in at some point this week or next week, at the latest, to secure scrap for late-April and early-May delivery, with the results of Mondays tender expected to set the tone for that new round of buys.
"(On Monday one Turkish mill) launched a tender and we are awaiting the results," one European exporter said March 25. "Weather conditions remain very cold and disruptive for scrap collection; therefore, it seems that Black Sea suppliers are not selling easily on lower levels of $380 per tonne c.f.r., which (the) Turkish are expecting them to do. Let us see this week if (the) U.S. market will drop below $400 or not."
A buyer for a second Turkish producer said he expects this week to be a quiet one.
"I am expecting a quiet week. Sales on (the) product side are extremely slow. On the other hand, everybody is waiting for (the) price of scrap to get lower. Now (the) euro is getting cheaper. Spring is approaching although weather (is) still cold but will warm up soon. ... Under these circumstances prices should get softer," he said.
A European sale into Turkey last week at less than $400 per tonne for HMS 1&2 (80:20) and a $10-per-gross-ton drop in buying prices at U.S. East Coast export docks (amm.com, March 20) also suggests a possible weakening in prices, one U.S. exporter said.
Turkish mills have remained active in the Commonwealth of Independent States (CIS) region, with many reporting sales from Russia and Romania in a $376- to $380-per-tonne range for A3 scrap, a regional heavy-melt grade, sources said.
The absence of any reported U.S. sales to Turkey over the past week left AMMs weekly East Coast Ferrous Scrap Export Index for HMS 1&2 (80:20) unchanged March 25 at $375.58 per tonne f.o.b. New York.
Meanwhile, bulk export activity returned to the West Coast after a brief lull, with one exporter booking two bulk cargo sales to China this past week at $420 per tonne c.i.f. for HMS 1&2 (80:20).
The sales pushed AMMs West Coast Ferrous Scrap Export Index for HMS 1&2 (80:20) up slightly to $382 per tonne f.o.b. Los Angeles on March 25, up 0.3 percent from $380.83 per tonne previously.