Market
participants in the Benelux are seen questioning a possible price recovery
following an EU-origin scrap deal in Turkey.
On Friday, a western long steel mill bought an EU-origin cargo
comprising 18,000 tonnes of HMS 1&2 80:20 at $344/tonne, 12,000t of
shredded at $364/t and 10,000t of bonus grade at $364/t cfr Turkey.
Compared to the latest UK-origin HMS 1&2 80:20 deal done at
$342/t cfr by the same producer the previous week, this new European deal
points to a recovery in prices.
However, although suppliers are interpreting this as an increase
in prices, most market participants in Turkey question if other mills will also
accept paying these values as most were resisting prices above $340/t cfr and
preferred to wait.
A Turkish mill tells Kallanish: “The
producer might have paid this price due to the high tonnage of shredded and
bonus in the cargo. If this was just an HMS 1&2 80:20 cargo, no one would
accept to pay this price.”
Another mill says: “I think scrap should be at around $300/t cfr
levels. When you look at the prices of billet and slab in the international
market, obviously Turkey has no competitive power with the current finished and
semi-finished steel prices.”
A Benelux scrap supplier comments: “I agree that steel sales are
not doing well but, on the other hand, collection is interrupted at these
prices due to higher collection costs. Scrap prices cannot fall further.”
Dock prices in the Benelux, meanwhile, decreased to €275-290/t
($275-290) delivered on Monday, down from €285-295/t on Monday last week.
Material flow, however, remains quite weak at these levels.
In the Indian sub-continent, demand for scrap remains subdued,
putting pressure on prices. While the Pakistani economy is suffering in the
aftermath of flooding, weak finished steel demand and the arrival of previously
booked bulk cargoes in India are hampering new scrap demand. Containerised
shredded offers were seen standing at $440-450/t cfr Nhava Sheva on Monday.