Turkish rebar returns to US, scrap correction possible

Posted on 11 September 2020

A Turkish mill has managed to sell 30,000 tonnes of rebar to the US following the increase seen in domestic US rebar prices. The latest Turkish scrap booking, however, suggests a correction may take place.

Although the exact price of the rebar sale is yet to be confirmed, it is anticipated at $580-590/tonne cfr US levels as the buyer was inquiring for material at $580/t cfr. The increase in the US domestic rebar market has helped Turkish supply there to return, as predicted.

Turkish mills have further increased their rebar quotes this week amid higher scrap prices. Export offers, which stood at $460/t fob a week ago, currently stand mostly at $465-470/t fob actual weight.

Although Turkey has sold to the US, demand in other markets continues to be weak. No fresh sales to Asia have been heard this week, following the 52,000t of sales to Hong Kong last week. Offers to Singapore and Hong Kong this week are heard at $480/t cfr theoretical weight and $490/t cfr actual weight respectively.

A Turkish rebar producer tells Kallanish: “Demand is weaker in our traditional markets this week. Buyers find price levels high.”

Another Turkish producer says: “Demand is not strong; however, prices are not expected to fall due to the firm scrap market.”

Following a strong start to the week, demand in the Turkish domestic market has also slowed. Domestic rebar prices have remained unchanged since hitting a 2020-high on Tuesday. On Thursday, prices stood at TRY 4,050-4,080/t ex-works, VAT included, up from TRY 3,980-4,020/t a week earlier. With the lira at 7.45 per dollar on Thursday close, that equates to $460-464/t ex-works, excluding VAT, up from $453-457/t a week ago.

Imported scrap prices, meanwhile, have inched down slightly on a deal concluded from St. Petersburg at $300/t cfr Turkey for HMS 1&2 80:20. The previous Baltic-origin HMS 80:20 deal was at $301.5/t cfr. Turkish mills are seen to have stepped back from scrap purchases. This, coupled with the high number of offers in the market, will likely exert pressure on scrap prices.

Source : Kallanish