A fall in prices – with a twist in the tale

Global – Although ferrous scrap prices have spent most of the last seven weeks on a sharply downward track since Recycling International’€™s previous ferrous market analysis, recent days have brought a small move in the opposite direction.

Latest cfr price indications for shipments from Europe to Turkey are around US$ 50 lower than at the time of our early-June report, reaching US$ 220-225 per tonne for standard quality HMS I/II 80/20 scrap and US$ 225-230 for shredded. Value drained out of the market because of the combined effects of Ramadan, market uncertainty and, most particularly, the availability of low Chinese billet offers.

At times, the international ferrous scrap market has slowed to a virtual crawl, with the early weeks of June proving to be a complete wash-out for suppliers to Turkey – the world’s largest ferrous scrap importer. Once Turkish mills resumed deep-sea bookings, prices paid to Baltic suppliers for HMS I/II 80/20 scrap slid to around US$ 225 per tonne before recovering very recently to US$ 230 and slightly above.

Iron ore prices have also taken a hammering since our previous report, with the Metal Bulletin 62% iron ore index dropping as low as US$ 44-45 per tonne before mounting an uncertain recovery to around US$ 55.

Meanwhile, the 2015 half-term report from the World Steel Association reveals that global crude steel output was down 2% at 813.045 million tonnes in the year to June – a total almost 17 million tonnes short of that for the opening six months of 2014.

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