Some Turkish long steel mills have begun considering stoppages after failing to secure higher prices in either the domestic or export markets, while energy and scrap costs have remained high, a major Turkish long steelmaker manager told S&P Global Commodity Insights Aug. 22.
“Without a recovery in demand, it wouldn’t be possible for Turkish producers to continue production,” the manager said, adding that as producers had been adding to stocks for a while due to low demand, they had begun considering stoppages.
“As our raw material stocks are enough to work till the end of October, we could continue to work with reduced capacity depending on market conditions,” the manager said, adding that his company had already reduced output to 12 hours/day.
“If the weak market sentiment persists and input costs remain high, we may stop production fully in the first week of November,” the manager said.
Although some Turkish long steel mills raised their lira-denominated domestic rebar list prices Aug. 19 to keep them stable on a dollar basis in the range of $650-$670/mt EXW, after the Turkish currency depreciated further, low demand continued to pressure quotes amid strong input costs, sources said.
Platts assessed Turkish imports of premium heavy melting scrap 1/2 (80:20) at $397.50/mt CFR Aug. 19, unchanged day on day, while Turkish exported rebar was assessed at $645/mt FOB, down $7.50/mt on the day, according to data from S&P Global.
Domestic scrap purchase prices
Although imported scrap prices remained relatively stable, some major Turkish steel mills reduced their domestic scrap purchase prices Aug. 20 amid a weak finished product market.
According to company price lists seen by S&P Global, Colakoglu cut its DKP grade scrap (autobundle) purchase price and its extra grade domestic scrap price by Lira 200 to Lira 7,480/mt ($412/mt) and Lira 6,955/mt, respectively.
Oyak Maden Metalurji Group’s Iskenderun mill, Isdemir, and its Eregli mill, Erdemir, both lowered purchase prices by Lira 100/mt to Lira 7,400/mt and Lira 7,480/mt for DKP grade domestic scrap, and Lira 7,395/mt and Lira 7,475/mt for extra-grade scrap, respectively.
Asil Celik’s DKP scrap buying price was set at Lira 7,530/mt while its extra grade domestic scrap buying price fell to Lira 6,800/mt.
— Cenk Can