NEW YORK U.S. bulk scrap export activity continues to diverge off the East and West coasts, with West Coast exporters facing thin Asian demand despite a softening price environment and East Coast exporters reporting a flurry of recent activity, including three cargoes booked this past week alone.
Most market participants said not one bulk cargo of ferrous scrap was sold off the West Coast this past week, although a few sources reported rumors of an unconfirmed sale to Vietnam.
Bulk offer prices to consumers in Malaysia, Vietnam, Indonesia and Taiwan dropped at least $5 per tonne last week, according to various market sources.
Current offer levels for scrap delivered to Malaysia are at around $360 to $361 per tonne c.i.f. for an 80/20 mix of No. 1 and No. 2 heavy melt, sources said. Delivered prices to Vietnam are trending a bit below that level due to lower freight costs, AMM understands.
As a result, AMMs weekly West Coast Ferrous Scrap Export Index for HMS 1&2 (80:20) settled July 1 at $326.83 per tonne f.o.b. Los Angeles, down 1.4 percent from $331.47 per tonne a week ago.
In contrast, East Coast exporters booked three cargo sales to Turkey this past week, with one cargo negotiated at prices well below the others.
Two exporters sold cargoes of about 40,000 tonnes or more at about $359 per tonne c.i.f. Turkey for HMS 1&2 (80:20). However, sources said one cargo was booked for prompt delivery in July while the other was booked for mid- to late-August delivery.
Early last week, a third exporter sold a smaller cargo of about 28,000 tonnes of HMS 1&2 (90:10) and shredded scrap at a composite price of $355 per tonne c.i.f. Turkey, indicating that it had accepted prices well below levels achieved by other exporters.
"Exporters will want to get a feel for how strong domestic is going to be before selling to Turkey for August deliveries," one source said of this weeks market.
A buyer for a steel producer in Turkey said last weeks slight uptick in export prices off the East Coast was driven by mills short on inventory.
"It is said that mills stock levels were very low. In my opinion, producers that need prompt shipments will pay higher prices. We could see some higher-priced sales for July, but after that, (the) market can get weaker," he said.
One European exporter estimated that at least 10 to 15 bulk cargoes remain to be sold into Turkey for August shipment. "The market will remain very firm and speculated due to the vacation period and low stocks in scrapyards and mills," he said.
AMMs weekly East Coast Ferrous Scrap Export Index for HMS 1&2 (80:20) settled July 1 at $328.86 per tonne f.o.b. New York, up nearly 1 percent from $325.74 per tonne a week earlier.