ORLANDO, Fla. East Coast
bulk ferrous scrap export prices shed more than $10 per tonne
April 10 after a single sale to Turkey broke a nearly monthlong
deadlock between U.S. exporters and Turkish buyers.
According to several market
participants, a Turkish mill booked a mixed cargo of about
20,000 tonnes of an 80/20 mix of No. 1 and No. 2 heavy melt,
20,000 tonnes of shredded scrap and 5,000 tonnes of plate and
structural scrap from a U.S. exporter that had been absent from
the market for more than two months.
The cargo sold for a composite
price of $390 per tonne c.i.f. Samsun, Turkey, putting the HMS
1&2 (80:20) value at anywhere between $387 and $389 per
tonne, most sources said, indicating a drop of at least $11 per
tonne from the last U.S. sale to Turkey almost a month ago.
One exporter based in Europe
said the price raised some eyebrows. "Everybody here is
surprised about this low level, especially because (freight to)
Samsun is more expensive than anything else," he said.
The exporter said buyers in
Turkey had sent out offers of $370 per tonne for HMS 1&2
(70:30) to European exporters, but Wednesdays sale will
likely push offers downward. "They will go for lower numbers as
the steel market remains lousy," he said. "The question is: How
much scrap is in the U.S.? Is there any pressure to sell?"
A buyer for one Turkish mill
said it was unclear if the sale would trigger a much-awaited
round of scrap buying by Turkey. "At the moment, demand is weak
because mills are not selling finished product. Turkish mills
have started to decrease production capacity and can stop
buying scrap. Thats why the prices are falling," he said.
"Only some mills that need scrap are buying."
The buyer said that part of the
reluctance to participate early in this environment is that
mill buyers feel that the longer they wait, the cheaper scrap
will be. "Whoever buys scrap today, tomorrow the other mill
will buy cheaper, so mills are hesitant to buy," he said.
A buyer for a second Turkish
mill said he expects consumers to push for a $385-per-tonne
price for HMS 1&2 (80:20), based on the higher freight
costs included in the April 10 booking. "Considering freight
from the U.S. to the Black Sea, producers will push for lower
prices, such as $385 (per tonne) for HMS 80/20. This could
become the new price level," he said.
A buyer for a third mill in
Turkey said it was still too early to comment on where prices
for the next round of trading will settle.