Posted on 06 Feb 2024
With US February scrap trading set to begin soon, some mills have already started expressing lower price targets and market participants are seen losing their optimism about prices, Kallanish notes.
Ahead of trading, prime grades are seen to be under stronger pressure compared to obsolete grades as obsolete supply was strongly impacted by harsh weather conditions in January. Some mills, expecting lower prices in February trading, cancelled their delayed January-shipment cargoes last week.
Declining prices in the main export destinations, as well as US domestic hot rolled coil values are also supportive of mills’ lower price expectations in February.
Mills are seen expecting price declines for all grades, while suppliers think some grades may remain unchanged from January.
For US West Coast business, prices dropped in Taiwan ahead of the Lunar New Year holiday. Containerised US-origin HMS 1&2 80:20 scrap offer prices softened to $375/t cfr Taiwan at the end of last week, with Taiwanese buyers showing weak interest. This pointed to a $7-10/t on-week decline, while activity is not expected to resume until after the holiday.
On the East Coast, US suppliers failed to achieve prices at above $425/t cfr in Turkey. Although offers stood mostly at above $425/t cfr for HMS 1&2 80:20, bookings were concluded at $421-422/t cfr levels. Turkish mills are expected to prefer US cargoes as European scrap is offered at the same levels as US scrap. Turkish mills’ buying interest is expected to continue this week.
Source:Kallanish
