Ferrous: war leaves sellers unsure

Turkish deepsea import scrap prices rose by around US$ 23 per tonne in March following the US and Israeli attacks on Iran.

The outbreak of fighting in the Middle East War and subsequent upward pressure on freight and energy costs left many participants hesitant. Turkish deepsea import scrap prices rose by US$ 23 per tonne CFR in March, with skyrocketing freight and energy costs supporting elevated price levels.

Platts, part of S&P Global Energy, assessed Turkish imports of premium heavy melting scrap 1/2 (80:20) at US$ 398 per tonne CFR on 30 March, up from US$ 375 at the end of February.

Prices remained flat at US$ 375 between the end of February and 10 March, with sellers reportedly facing significant challenges in calculating the freight component for deepsea cargoes amid rapidly rising dry bulk freight costs.

Deal activity remained limited in early March, with Turkish mills reportedly hesitant to begin purchasing scrap cargoes at elevated price levels and continuously postponing scrap purchases for April and early-May shipment.

However, towards the end of March, mills came under more pressure to buy, with participants reporting that stock levels were very low in the second half of the month.

CHANGING CONDITIONS

Some market participants expected demand from Turkish mills to remain consistent into April but many found it difficult to calculate price expectations due to the changing conditions of the Middle East war.

‘Which direction the war goes is the most important part [impacting] energy, logistics and transportation costs,’ a trader source said.

The Iran conflict was flashing alarm bells when the latest economic report from the European Steel Association (Eurofer) was published in mid-March.

‘Following the outbreak of the war in Iran, volatility has increased and the benchmark TTF gas price exceeded EUR 50 per MWh in March 2026, adding further pressure on industrial competitiveness and investment conditions across Europe’s manufacturing value chains,’ the report said.

It also highlighted ‘persistently weak demand’ forcing the European steel industry to reduce production and restructure capacity, with EU crude steel output falling to a historic low of around 125.8 million tonnes in 2025, compared with 130 million tonnes in 2024.

EU apparent steel consumption was estimated to grow by +2.4% in 2025 and by 1.3% in 2026. ‘However, the increase largely reflects a comparison with exceptionally low demand in previous years, rather than a demand-driven recovery.’

DEMAND BOOST

Meanwhile, ferrous traders reported that a tighter supply of semi-finished steel products  boosted demand for scrap imports toward the end of March. ‘Delivery time from China is too long, and Iran and Russia are not able to supply as much billet and slab, so Turkish mills are trying to catch up on buying scrap,’ a sell-side source said.

Participants reported a flurry of deal activity toward the end of March, with Turkish mills restocking for April. Approximately 20 deals were concluded between 24-27 March, participants reported.

While US-origin cargoes with HMS 1/2 (80:20) were booked by Turkish mills at around US$ 398 per tonne CFR, Baltic-origin cargoes were said to have been booked at UD$ 395 and EU and UK origin cargoes of US$ 390 were recorded during the same period.

US scrap companies were reportedly offering US$ 402-405 per tonne CFR at the end of March, compared with US$ 380 a month prior.

‘The market driver is not demand or supply… It’s the war situation: if we see the war continue, prices will increase,’ one trader source said.

PRICE LIMIT?

Sell-side sentiment remained firm at the end of March amid rising prices in the downstream Turkish rebar market. Platts assessed Turkish exported rebar at US$ 595 per tonne FOB Türkiye on 30 March, up US$ 40 per tonne from US$ 555 at the end of February.

Despite this, some participants remained sceptical of the sustainability of elevated price levels amid unchanged downstream demand. ‘Scrap prices cannot go too high due to lower rebar sales,’ one recycler source said. A second recycler source said scrap prices could go higher, but ‘with significant risk-off possibility’.

Ahead of the fighting, industry reports noted that global ferrous scrap markets had maintained a firm tone in early 2026, with tightening supply conditions and steady steel demand underpinning prices across key regions.

Fastmarkets reported that US ferrous scrap prices rose sharply at the start of the year, with February values increasing by more than 7% month-on-month. The price rally was driven by limited availability of obsolete scrap grades and robust mill buying, particularly as steel producers sought to secure feedstock ahead of anticipated production runs.

Market conditions earlier in the year had been described by FM as the strongest since 2022, reflecting constrained supply and consistent downstream demand.

SIMS: ‘FUNDAMENTALS STRONG‘

Sims’ latest outlook notes the group’s sales revenue of US$ 3 778.6 million (EUR 3 262 million) was up 3.7% from the prior corresponding period. The underlying EBIT of US$ 121 million was up 65.9%, driven by ‘exponential’ SLS growth and improvements in North American Metal, US joint venture SA Recycling and corporate costs.

Commenting on scrap trade, the outlook adds: ‘Long-term ferrous scrap fundamentals are expected to remain strong: EAF capacity and scrap demand are expected to continue to grow, underpinned by decarbonisation and government policies supporting onshoring.’

The group has benefitted from US trade barriers: ‘Tariffs are expected to continue to protect domestic steel and aluminium industries, supporting local demand for ferrous scrap. The premium for domestic shred sales is expected to continue to benefit NAM and SA Recycling’s margins.’

The report also reflects on the failure of Unimetals in the UK last year. Sims sold its UK operation to investors in 2024, after which the business was rebranded. But Unimetals went under before making all the payments to Sims and this is reported to have cost it US$ 42.5 million.

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