Benelux scrap prices fall amid Turkey pressure

Scrap prices have decreased in the Benelux amid a stronger euro against the dollar and price pressure in export destinations.

Turkey’s scrap demand remained in a lull in the last week of 2021. Turkish mills, which have been forced to increase rebar quotes amid higher scrap offer prices, halted scrap purchases last week. Before accepting higher prices for scrap, they initially want to gauge rebar buyers’ reaction to higher prices. Rebar export sales, however, remained very limited amid the holidays and higher prices.

Some exporters are seen to have decreased their dock prices for HMS 1&2 80:20 to €335-340/tonne ($380-386) delivered from €350-355/t last week amid the stronger euro and export pressure. However, some exporters have not yet revised their dock prices due to continuing holidays.

European mills, on the other hand, are waiting to see what price levels Turkish buyers settle at before initiating their January purchases, Kallanish notes.

Although European sellers are targeting to sell HMS 1&2 80:20 at above $460/t cfr Turkey, Turkish mills find these levels high given their high production costs. They are seen aiming to buy European scrap at below $450-453/t cfr. Their need for February-shipment scrap purchases is seen curbing expectations of a larger price decrease.

Turkish mills’ production costs have increased even further in the new year due to the 52-130% rises seen in power prices and 25% increase in natural gas prices in Turkey. This will most probably cause mills to exert stronger pressure on scrap prices as they have already been struggling to compete in the global arena for a while.

Although no booking was heard in India last week, Indian buyers are seen to have decreased their price targets for containerised shredded from $515/t cfr to $505-510/t cfr India. This is amid decreasing steel prices and bearish sentiment. Scrap suppliers, however, are seen offering at above $520/t cfr.

Burcak Alpman Turkey