Further downtrend likely for Turkish scrap prices

Turkish scrap import prices unchanged w/w

The Turkish scrap market remained silent last week. Our assessment is unchanged at $372 /t CFR for HMS 1/2 80:20 (+$0 /t w/w, +$7 /t m/m) due to a lack of new confirmed deals.

Although no deals were heard for scrap, market participants have indicated scrap prices are under pressure. Latest bids are thought to be as low as $330 /t for HMS 80:20.

Market activity remains subdued with Turkish finished steel export prices continued to edge lower by $5-10 /t w/w for longs products, unable to compete with prices in Asia and the Middle East. For larger volumes, deals were concluded at even lower prices, indicating persistent slow demand.

In the Asian scrap markets, Vietnamese mills have stopped buying as many of them are cutting production or taking shutdowns due to low steel demand. Offer for H2 stays flat w/w, at $400 /t CFR Vietnam.

Outlook: Turkish scrap prices will likely go down in the near term

We expect Turkish scrap prices to reduce from current levels in the near term, according to market indications. As mills are dropped their offers for the past two weeks in the face of subdued steel demand, either energy or scrap costs need to give way for this. By the end of the year, scrap prices may find some support from tighter supply during the winter.