NEW YORK U.S. ferrous scrap export markets recorded a mixed week as bulk shipment tags to Turkey and containerized scrap prices to India held steady while demand from Far East Asia dropped to send West Coast export prices lower.
Demand momentum for bulk scrap exports to Turkey continued as two more sales reportedly were concluded May 14 and 15 following four bookings between May 8 and 13 (amm.com, May 13).
Market participants said one East Coast cargo sold May 14 at $375 per tonne c.i.f. Turkey for an 80/20 mix of No. 1 and No. 2 heavy melt, while a second sold May 15 at $376 per tonne, indicating steady pricing as Turkish demand for U.S. scrap remains strong.
Containerized scrap exporters reported a sharp increase in the number of inquiries from Indian buyers this week, although very few transactions were reported as India awaits the results of a long general election, which are scheduled to be announced over the weekend.
Speculation that a pro-industry leader will be elected helped prop up the Indian rupee a little and lift market sentiment to keep scrap prices into the country mostly unchanged on the limited volumes that did trade this week, despite softening prices into neighboring southeast Asian countries.
"There is not much active trading this week in India (ahead of) the election results. In the meantime, the currency appreciated and made it positive for imports," said one Indian buyer, while a trader called market sentiment "very upbeat" as demand has picked up following better spreads between Indian rebar sales prices and scrap purchase prices.
"Indian mills are quite active in terms of inquiries at the moment," a second trader said. "The recent strengthening of the rupee against the dollar has made things more favorable.."
Indian market participants said prices for containerized HMS 1&2 (80:20) have remained steady in a range of $375 to $380 per tonne c.f.r. Nhava Sheva.
Exporters said No. 1 heavy melt generated out of the United Arab Emirates and South Africa sold into India this week in a range of $390 to $400 per tonne c.f.r. Nhava Sheva, indicating marginal strengthening from a week ago, while shredded scrap prices remained in a range of $400 to $405 per tonne.
East Coast suppliers said f.a.s. values for shred were steady this week at $365 per tonne despite a surge in inquiries, which some hoped would result in better sales prices next week following election results.
In Asia, the start of seasonal electricity supply cuts on May 10, which will trigger a 30-percent drop in steel production, resulted in very little trading and sent containerized scrap prices down about $5 per tonne on average to a range of $340 to $345 per tonne c.f.r. Taiwan, according to several buyers and sellers.
South Korean mills with sufficient scrap inventory in the pipeline offered no demand support for exporters, and they are expected to suffer from similar summer electricity cuts in June, further dampening near-term sentiment.
The absence of strong demand from two of the regions largest consumers is expected to put pressure on prices into other importing countries like Vietnam, Malaysia and Indonesia, which have stayed relatively steady so far, some traders said.