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Kallanish Kallanish

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June, 26th 2019

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JAN 10

Turkish scrap bookings accelerate, rebar mills target Europe


Turkish deep-sea scrap import bookings have accelerated this week. Rebar mills are focussing on loading rebar cargoes to Europe to complete shipments there before the EU safeguard quota is used up, market participants tell Kallanish.

Three scrap bookings were heard each from the US and the Baltic, with a further two coming from the Benelux. Two of the US bookings earlier in the week each contained 30,000 tonnes for January shipment, with HMS 1&2 80:20 priced at $280/tonne cfr Turkey, shredded at $285/t and bonus at $290/t. The third contained 40,000t with the same composition and prices.

Although the US deals clearly show stable pricing, the Baltic cargoes – all reported in the second half of the week – gave some mixed signals. One of the consignments was for 28,000t of HMS 80:20 at $280/t, 5,000t shredded at $285/t and 3,000t bonus at $290/t. The second was for 31,000t of HMS 80:20 at $281.5/t and 2,000t bonus at $291.5/t, while the third had HMS 80:20 priced at $277.5/t and bonus at $287.5/t.

A European scrap merchant said the latest deals show scrap prices have bottomed. “I have just declined bids at levels of $281.5 from two mills – I expect we will do better.” However, upon hearing the suggestion that scrap has bottomed an international steel trader said: “I don’t think so. I think we’ll see $260s in a couple of weeks.” In reaction to the $281.5 deal another steel trader added: “Both seller and buyer can confirm any weirdly high price today.”

Various sources reported Turkish rebar export offers have increased on-week to $455-460/t fob Turkey, although some said $450/t was available, and one trader even cited $440/t as achievable. One Turkish trader suggests the higher offers may be “… mills trying to artificially force up the market.” He says some mills pushed up prices when they started buying scrap, “… but I think they were just trying to show overseas buyers the market is moving again, which it isn't.” The majority of sources agree demand has not improved.

Another Turkish trader says: “This month we are focusing on Europe – approximately 160,000 tonnes of material will be loaded to Europe in the next ten days to catch the safeguard deadline.” Once Europe is out of the picture, however, “… February will be a disaster,” he adds.