Scrap prices in Turkey continue to increase as mills’ demand for scrap remains strong after the Turkish government’s statements regarding  reconstruction of earthquake-hit cities in 3-4 months. The first tender for the construction of 200-250,000 houses in March will be held on 22 February.

Amid strong scrap demand, some suppliers, targeting even higher levels, are seen to have backed off from the market. The ones that are in the market have offered premium HMS 1&2 80:20 above $430/tonne cfr on Tuesday.

A Baltic HMS 1&2 80:20 deal was heard concluded by a western mill at $429.75/t cfr, although the details have not yet been revealed. Another western mill bought UK-origin cargo comprising HMS 1&2 80:20 at $428/t and shredded at $453/t cfr. A northern mill bought Denmark-origin cargo comprising 16,000 tonnes of HMS 1&2 90:10 at $439/t and 24,000t of busheling at $467/t cfr. 

There are also rumours of a Baltic sale at $425/t and a US sale at $423/t cfr. However, even if they are correct, they might have booked earlier and do not reflect Tuesday’s value for premium scrap. It is very likely that today’s prices will not be available tomorrow either.

Short-sea offers have also increased sharply to $410-415/t cfr. A Romanian supplier is heard offering bonus grade at $460/t cfr.

An imported scrap agent tells Kallanish: "Turkey’s demand for scrap is quite strong. Most suppliers are not in a rush to sell and prefer to wait today."

A supplier thinks Turkey still needs to buy at least 500,000t for March shipment, which equates to 13-14 deep sea cargoes.

Most market participants think scrap prices are likely to reach $450/t cfr levels under current market dynamics.

Meanwhile, rebar prices also increased sharply this week. Some mills, facing a sharp increase in scrap offers, are seen halting rebar sales throughout the week, while others have increased offer prices to $730/t ex-works levels. Even higher offers, above $740/t are available from a few producers in the absence of some producers.

Billet offers also increased sharply on Tuesday. A southern mill is heard to have sold 7,000t of billet at $675/t ex-works, while imported billet offers rose around $640/t cfr levels.

A western mill that requires raw materials has increased shipbuilding scrap buying price by $5/t to $425/t delivered on Tuesday, meanwhile.