Low steel demand brings down Spanish scrap prices

Spanish scrap prices are seeing a downward correction, Kallanish learns from local market sources. After reaching a three-month high in the last days of August, prices have so far fallen €20/tonne ($19.95/t) in September. This trend is set to continue as values are impacted by softening domestic demand, production cuts at certain large mills, and a relatively quiet international scrap market.

“The deceleration of local demand could force Spanish prices to move down a further €30/t in the week,” a local merchant says. “It is difficult to predict how the market will evolve by the end of this month. What is really certain is that the planned shutdown of one of ArcelorMittal’s two blast furnaces in the Asturias region since 28 September will further worsen the already difficult situation for the Spanish steel industry and consequently the scrap supply chain, which is forced to lower its prices.”

Spanish scrap prices are also expected to fall to align with lower international market levels, another source comments. “Turkey does not have much demand and prices in Europe are still higher than they are there, so it is understood that scrap levels will drop by at least €30/t in the next weeks. This adjustment equals the difference in freight we have compared to Turkey,” says a market participant.

New E8 quality in the domestic Spanish market is now offered at €410/t delivered. E40 and demolition quality grade (E3) are at €360/t and €345/t delivered, respectively. E1 quality is delivered at €290-300/t.

Todor Kirkov Bulgaria