Benelux scrap falls despite increasing domestic prices

Scrap prices in the Benelux have softened due to weak buying interest in major export destinations.

Exporters’ dock prices, which were at around €340-350/tonne a week ago, were mostly at $330-335/t ($357-362) delivered on Monday.

Although inflow remains slow at these levels, exporters, who are still cautious about export markets, are refusing to increase their prices unless they need to fill a vessel.

A Benelux exporter tells Kallanish: “We are able to obtain low volumes from some small suppliers at €330/t but big ones are refusing to sell at these levels. They [collectors] received respite with the latest sales at above $340/t and are not willing to decrease prices now.”

Another exporter says that most domestic suppliers are targeting €340-350/t levels again as, despite pressured exports, prices now have support from the European domestic market.

However, last week Turkey refused to buy scrap even at the previous week’s levels amid subdued steel sales and falling product prices. Despite higher domestic European prices and the stronger euro against the dollar, Benelux scrap exporters are seen to have sold at lower levels.

In Turkey, EU-origin HMS 1&2 80:20 dropped to $405/t and $408.5/t cfr on two bookings last week, from $414-417/t levels the previous week. UK-origin HMS 1&2 80:20, meanwhile, fell to $400/t cfr on the latest booking for 22,000 tonnes on Friday, from $412/t cfr in the first week of the year.

Although a Poland-origin sale is heard to have been booked at $414.5/t for HMS 1&2 80:20 and $434.5/t cfr for shredded, it was concluded on 6 January.

Besides Turkish mills’ low appetite for scrap purchases, Pakistani scrap importers’ being unable to open letters of credit is also pressuring scrap prices.

An Indian supplier says that around 20,000t of material – mostly shredded – on the water has to be directed to alternative destinations, mostly to India. “This coupled with traders’ open positions and offered material is expected to total 70,000-80,000t and will put prices in Indian and other markets under pressure,” he adds.

Containerised shredded offers hit $460/t cfr last week in India, but were at around $450/t cfr on Monday.

Burcak Alpman Turkey