NEW YORK A bulk cargo
sale of ferrous scrap to Turkey out of the Gulf Coast has
provided the market with a clearer vision of upcoming
negotiations as more Turkish steel mills enter the market to
Several market participants
reported an April 25 sale out of Houston to a Turkish mill at a
composite price of $383 per tonne c.f.r. Turkey. The cargo was
said to comprise 32,000 tonnes of an 80/20 mix of No. 1 and No.
2 heavy melt, 8,000 tonnes of shredded scrap and 5,000 tonnes
of plate and structural scrap.
Vessels sailing from Houston
typically attract an additional freight cost of $3 per tonne
over vessels leaving East Coast docks; that would result in the
Houston sale setting a price level of around $378 per tonne for
East Coast sales of HMS 1&2 (80:20) to Turkey.
A trader in Turkey said he
expects the sale to encourage buyers for Turkish mills to open
negotiations with U.S. exporters at $375 per tonne, with $375
to $378 being the range. Such a range would fall in line with
day-earlier speculation in the United States after news broke
of a two-cargo sale to Turkey (
amm.com, April 24).
A second source in Turkey said
the range appeared reasonable, given current market conditions.
Domestic sales of rebar and debar (deformed reinforcing bar)
were slow and a cargo of billet was booked at $510 per tonne
c.f.r. Turkey, the source said.
"In general, a bottom may be
coming, but for sure demand is not supporting any upside.
(Scrap) collection is good in the (Commonwealth of Independent
States region) as well. Turks are cutting down on production
silently. Mills have been trying to sell volumes to pay debts,
but there is no margin, so that is also not working due to low
demand," he said.
"There seems to be no upside in
the near future unless an unforeseen thing comes up (that) will
drive the market. $375 to $380 for U.S. HMS 1&2 (80:20)
more or less justifies the (deformed reinforcing bar) price
cost to cost today," he said. "Nobody will rush to buy cargoes
as of today."