Turkish scrap prices continue to edge lower

Turkish scrap import prices marginally declined w/w

Turkish scrap prices fell marginally last week, down to $344 /t CFR for HMS 1/2 80:20 (-$5 /t w/w, -$49 /t m/m).

Scrap prices⁽¹⁾ $/t	26-Aug	02-Sep	09-Sep	16-Sep	23-Sep
HMS 1/2 80:20 CFR Turkey	393	396	371	349	344
Shredded CFR Turkey	413	416	391	369	364
Notes: (1) weighted average of known transactions from all points of origin.

Turkish longs export demand was subdued last week as there is still a reluctance from market participants to purchase big volumes in current market conditions. Some small quantities of longs products were sold to Europe, but interest outside Europe was limited as Turkish material lost competitiveness mainly due to the sharp increase in energy costs. As a result, buying activity in the scrap market has been limited, with steel production facing downside risks from high energy costs and slow demand.

Asian scrap markets were quiet last week after a $25 /t w/w decrease in offers in mid-September. Scrap sellers are looking to increase offers to $400–405 /t CFR Vietnam in the near term.

Outlook: Energy costs present downside risk to scrap demand

Typical scrap restocking demand in September has not entered the market. Export demand for Turkish finished steel may stay limited given competitively-priced exports from Asia and Middle East, as well as further upside risks to Turkish offers due to more limited use of Russian inputs. Together with persisting risks from high energy costs, the recovery in scrap demand may be further postponed.