NEW YORK Prices for U.S. bulk ferrous scrap exports to Turkey inched marginally higher last week after Turkish mills swarmed export markets for cargoes.
Strong demand from Turkish mills resulted in at least 11 cargo bookings from the United States and Europe and additional volumes along traditional Black Sea routes as mills sought to refill lean inventories.
U.S. exporters accounted for at least five of last weeks 11 cargoes booked by Turkey, with four originating from the East Coast and one from the Gulf Coast.
Market participants said a cargo from Houston was booked July 10 at $378 per tonne c.i.f. Turkey for 42,000 tonnes of an 80/20 mix of No. 1 and No. 2 heavy melt and $385 per tonne for 3,000 tonnes of plate and structural scrap.
The same exporter one day later reportedly sold a second cargo off the East Coast at $372 per tonne for 15,000 tonnes of HMS 1&2 (80:20) and $388 per tonne for 30,000 tonnes of plate and structural scrap.
Since the price differential on the second cargo between plate and structural scrap and heavy melt scrap was $6-per-tonne higher than the typical $10-per-tonne differential, several market participants suggested the second cargo traded above last weeks average price range of $372 to $373 per tonne for HMS 1&2 (80:20), indicating some firming of tags.
In addition to these cargoes and two others sold earlier last week (amm.com, July 10), another exporter also reportedly sold a cargo to Turkey at $372 per tonne for HMS 1&2 (80:20) and $5 more for shredded scrap.
AMMs East Coast Ferrous Scrap Export Index for HMS 1&2 (80:20) settled July 14 at $356.80 per tonne f.o.b., up 0.8 percent from $353.91 per tonne a week ago.
A buyer in Turkey said mills traded at strong prices last week because of the upcoming annual Ramadan holiday and several mills needed scrap, while a second buyer said buyers in countries such as Egypt and Kuwait have bid for scrap at higher prices, which Turkish mills have had to compete with in order to secure supply.
One exporter said the issue stemmed from lower volume purchases by mill buyers leading into this month.
"Mills booked a low number of cargoes against Ramadan time arrival. It was a really low figure compared to previous months. All players were waiting for the usual summer lull (in domestic markets) that never came. Demand by all European and U.S. mills has been on higher levels than the past two to three years," he said.
"Turkish mills dreamed about $360 to $365 (per tonne) levels for scrap, but it did not work," one Turkish trader said.
"Most of the mills need scrap but were not ready to pay over $370 to $372 (per tonne) due to weak rebar prices. On the other side collection of scrap has been lower than anticipated, so they will pay higher than $372 per tonne (for HMS) but will not accept more than $376 (per tonne)," he said.