The Turkish scrap import price edged up today on two deals concluded today and yesterday as the spread between scrap and domestic rebar prices widened on higher local rebar sales.
The Argus daily HMS 1/2 80:20 cfr Turkey and HMS 1/2 75:25 fob Rotterdam assessment increased by 20¢/t to $258.20/t and $233.80/t, respectively.
A Canadian supplier was confirmed to have sold 30,000t of shred at $263/t cfr Iskenderun for July shipment today. Billet was offered locally by an Iskenderun mill today at $390/t ex-works. A second Iskenderun mill sold about 6,000t of local rebar at the equivalent of $420/t ex-works.
A continental European exporter was heard to have sold 14,000t of HMS 1/2 80:20, 5,000t of P&S, 3,000t of busheling and 3,000t of oxy plates at an average price of $261/t cfr Marmara for July shipment yesterday.
A second continental European exporter was confirmed to have sold a mixed cargo at an average price of $261/t cfr Izmir for July shipment, with the composition unknown.
Local rebar demand jumped higher today, with mills increasing their local domestic rebar sales prices to an average of $415/t ex-works. Most offers moved up to $420/t by the end of the day.
The Marmara buyer of the first continental European scrap cargo was heard to have sold 3,000-5,000t of local rebar today at the equivalent of $417/t ex-works, stockists said.
A second Marmara mill was heard to have sold 6,000-8,000t today at that level and an Izmir mill was heard to have sold at least 10,000t at $415/t ex-works.
Higher local demand has pushed up Turkish domestic rebar prices at a faster rate relative to scrap over the past week. Domestic rebar prices increased to the equivalent of $10/t from a week ago, while the Argus HMS 1/2 80:20 cfr Turkey scrap assessment rose by $5.50/t over the same period.
The spread between imported scrap and domestic rebar prices consequently rose by about $5/t from $152-157/t last week to $157-162/t today.
This higher spread means Turkish mills will be incentivised to buy more July-shipment deep-sea scrap in the near term and they will be met by strong sales appetite from scrap exporters. Many deepsea scrap exporters are now seeing lower demand from other overseas customers compared with Turkey, which is likely to limit any sharp increase in offer prices.
Turkish steelmakers have already purchased a minimum 493,000t of deepsea cargoes for July shipment and are on course to match June deepsea-shipment buys of at least 1.0mn-1.1mn t. Mills have more than three weeks to buy this remaining tonnage, which will likely result in activity pausing for several days in June.
US export appetite has been strong in the past two weeks, and US scrap exporters are likely to seek to sell significant volumes into the stronger Turkish market later this month on indications that June-delivery domestic US prices were softer than expected, coupled with early sentiment that there will be minimal upward movement in July.
Cut grades traded sideways for June in the bellwether Detroit market this week, while shred fell by $5-10/t and prime grades moved up by $10/t.
Sub-suppliers to US docks were heard today to be competing more aggressively for increasing scrap flows. By July, market participants expect more of the US automotive sector to be back on line, which will increase prime scrap generation. Obsolete flows are picking up this month in the US, with an increase in demolition project activity.
There was no new shortsea Turkish imported scrap activity today, with rejected bids at $245/t cif Marmara for Romanian HMS 1/2 80:20 unmoved from yesterday.
The Argus daily A3 cif Marmara steel scrap assessment was flat at $248.40/t, while the daily A3 Russia-Ukraine fob Black Sea assessment was unchanged at $224.50/t.