French and Italian scrap prices are reversing their downward trajectory and rising sharply once again after having dipped during the first two weeks of February.

Following a long period of negotiations to settle February contracts at lower prices, mills in Italy and France are back at purchasing and are now looking for material. In Italy over the past few days most mills have increased their purchasing price by as much as €20/tonne ($21.2/t) for end-February/beginning of March delivery.

The February month-on-month price decline in scrap prices so far has been around €30/t on average throughout Europe, as reported. While the scrap grade new arisings (E8) had reached €220/t in Italy, some new contracts for end of the month delivery have been agreed at €250/t delivered. This represents a return to December price levels and is primarily due to Turkish buyers settling higher purchasing prices for imported scrap. Two weeks ago Turkish prices were at a level of $240/t cif for HMS 1 and 2 from the US and northern Europe but are now rising above $250/t cif, sources tell Kallanish.

Demolition qualities (E1, E3) and shredded scrap (E40) remain at last weeks’ level in most European countries. In Italy merchants who have E40 in stock would sell it for €240-250/t delivered this week but both E40 and demolition qualities are in short supply. Italian prices for demolition qualities are also at a standstill as the local rebar market is uncertain with a very low visibility.

Italian rebar makers are waiting for the issuance of Algerian import licences while the local market is characterised by poor demand. There is consequently not much demand for demolition qualities and these remain within last week’s price range. Higher quality E1 is between €210-215/t delivered while the lower E3 quality remains at €200-210/t delivered, sources suggest. By the end of this week the levels for new transaction prices will be clearer, Kallanish hears.