A bounce – but not a rebound

Global – Ferrous scrap prices have bounced off the floor – but not to levels that are getting anyone overly excited. Furthermore, there is persistent talk of the potential for fresh declines. Latest cfr price indications for shipments from Europe to Turkey are US$ 180-plus per tonne for standard quality HMS I/II 80/20 scrap and US$ 185-plus for shredded.

At the BIR world recycling convention in Prague late last month, experts pointed the finger at cheap Chinese billet exports as the key factor behind low ferrous scrap values. Iron ore prices have also been in decline: having exceeded US$ 56 per tonne cfr Qingdao at one point in early October, Metal Bulletin’s 62% Fe iron ore index caught the depressed mood of the steel market, dwindling to below US$ 50 before the end of the month and continuing to hover just short of this threshold.

Capacity utilisation in the global crude steelmaking sector was short of 70% in September – the third consecutive month spent below this mark. The rate of 69.3% was four percentage points below that of the same month last year but 1.3 percentage points ahead of that for August 2015.

The full version of Recycling International’s latest ferrous market analysis will appear in its November 2015 issue.