With July scrap deliveries approaching, Turkish steel producers are approaching the market cautiously. The limited number of sales realized so far is considered a reflection of the overall uncertainty in the sector. Both global price movements and logistics and trade policies are making it difficult for the market to find its direction.
Last week, although the HMS 80:20 price originating from the US dropped by about $3/ton, the flat price trend in the US domestic market and signs of increasing prices at European ports are making exporters reluctant to sell at low prices. Additionally, rising freight costs on the US East Coast are also reducing export pressure.
Post-Holiday Market Activity Expectations
While uncertainty remains about how finished product markets in Türkiye will gain momentum after the Eid al-Adha holiday, some market players anticipate a gradual recovery during the summer following the slowdown experienced in spring.
Current export offers on a CFR basis are around $335–340/ton for EU-origin HMS 80:20 scrap, $340–345/ton for US-origin scrap, and $360–370/ton for shredded scrap. However, these prices weaken the competitiveness of factories producing based on scrap.
Competition from Far East Billets Deepens
Cheap billets especially from Asia economically push EAF production to the background. Under current conditions, many producers find it more reasonable to focus only on rolling. This shift is reshaping production dynamics and cost balances in the sector. Exporting countries offering cheap billets gain advantage, while EAF-based producers are pushed into a higher-cost category.
Trade Policy Uncertainty in the US and Europe
Finished product prices have risen under Section 232 in the US, but scrap supply and price levels remain unclear. In Europe, if exports of finished products to the US are restricted, production planning and domestic market pricing could be seriously affected. Potential new quota implementations or additional import taxes are also increasing uncertainty in the market.
Logistics Constraints and Payment Terms Reality
It is stated that the earliest loading of affordable Far East-origin billets purchased today could be in August, with arrival in Türkiye possibly by early September. This timeframe may cause significant planning issues, especially for rolling mills producing construction rebar, which typically operate with payment terms of 15 to 30 days.
As the global scrap and finished product markets continue searching for direction, rising costs, political uncertainties, and logistical obstacles are forcing Turkish producers to adopt a cautious stance. Price trends and buying-selling behaviors in the coming weeks will determine how balances in the sector will shift. The balancing process is still ongoing.
Comments
No comment yet.