NEW YORK Export prices for U.S. bulk ferrous scrap shipped to Turkey have rebounded as demand trickled in amid a recovery in iron ore prices.
After staying away from markets to better understand a sudden drop in Chinese iron ore prices, Turkish mills short on inventory for April were back March 13 after iron ore prices recovered some lost ground to around $108 per tonne for 62-percent iron content product c.f.r. Qingdao.
Market players had speculated that U.S. offers for an 80/20 mix of No. 1 and No. 2 heavy melting scrap would rise to a range of $370 to $380 per tonne c.i.f. Turkey (amm.com, March 12). That appears to have materialized, with participants reporting a cargo sold at $367 to $369 per tonne c.i.f. Turkey for HMS 1&2 (80:20), depending on final freight costs.
The deal marks a nearly $20-per-tonne increase from the last U.S. bulk cargo sale to Turkey booked Feb. 21 (amm.com, Feb. 21), and comes on the heels of a weaker dollar, which means higher values based on recent price increases in European scrap sold to Turkey.
Sources said the East Coast cargo will carry 22,000 tonnes of HMS 1&2 (80:20), 5,000 tonnes of shredded scrap, and 13,000 tonnes of plate and structural scrap.
U.S. suppliers have indicated prices of $370 to $375 per tonne c.i.f. for HMS 1&2 (80:20) after a cargo from the United Kingdom was reportedly sold at $365.50 per tonne for heavy melt, one Turkish trader said.
Meanwhile, offers from Black Sea suppliers have also reached $365 per tonne, as some Turkish mills will need to buy cargoes for April shipment, he said.
I am expecting some activity on rebar, which may bring scrap prices to around a $370 to $380 level, which in fact is still high compared to the price of rebar in the market, one Turkish producer source said.
Until last year, the price of scrap in Far East Asia was always higher compared to Turkey due to freight differences. However, this has changed lately, which is not good for Turks at all. But it is our fault. Therefore, it is very difficult to make any prediction. As we all know, after winter, scrap prices used to drop due to an increase in availability. But it seems this will not be the case this time around, he said.
With British heavy melt at $365 per tonne, it was only natural for U.S. exporters to ask for $370 per tonne or higher for the higher-quality U.S.-origin scrap, one European exporter said.
The market is a bit stronger, the dollar is very weak now and European exporters will not drop their prices either. Therefore, I expect some U.S. sales to be done at $368- to $375-per-tonne levels, he said.