Turkish mills’ demand for scrap has not recovered totally. Most mills have difficulties in selling their finished steel products in both local and export markets and are thus delaying their scrap purchases despite a pressing need to replenish their scrap inventories. Two deals were nevertheless reported on Tuesday.

Although deep-sea scrap suppliers were trying to maintain their offer levels for HMS 1&2 80:20 at $270/tonne cfr Turkey this week, negotiations ended at much lower levels. Late on Tuesday a Turkish producer bought an ex-US cargo consisting of 17,500 tonnes of HMS 90:10 at $261/t, 6,000t of shredded at $263/t, and 6,500t of P&S scrap at $268/t. The HMS 80:20 equivalent of this cargo is $258/t cfr Turkey.

This followed last week’s reduction by a Baltic supplier of offers to $265/t cfr Turkey for HMS 80:20 following its latest sale at $275/t ten days prior. This led Turkish mills to bid at a maximum of $260/t.

A Turkish mill told Kallanish earlier on Tuesday: "All deep-sea suppliers are ready to sell cut grade at $270/t cfr but they cannot find a single buyer at this level. But I also think that ex-Baltic and ex-US suppliers will not accept levels below $260/t cfr, at least not this week.” Considering the previous ex-US HMS 80:20 deal at $270/t cfr Turkey last week, even Turkish steel producers were not expecting such a sudden drop in prices.

Prior to the latest US deal on Tuesday, a Turkish mill was heard having bought an ex-UK cargo consisting of 20,000t of HMS 80:20 at $250/t cfr, which is much lower than other deep-sea suppliers' offers. This supplier usually sells below the market level, but mills will likely use this as a reference point to argue for lower prices.

As the holiday season is over in the main scrap supplying regions, demand from their local markets is expected to increase. The decrease in USD/EUR parity may provide EU scrap suppliers with an advantage for their export sales.