Turkish buyers benefit from more ‘wiggle room’

Global – The weakness of Turkey’s lira in relation to the dollar and the country’s political uncertainty ahead of mayoral elections towards the end of March were widely blamed for a slow start to last month in scrap trading terms, although the few deals booked in the opening two weeks indicated a rising price trend.

When it became clear that Turkey’€™s prime minister Recep Tayyip Erdogan had secured a decisive election victory, the lira immediately gained strength against the US currency and provided the country’€™s mills with more wiggle room on the international market. Bookings at levels approaching US$ 375 per tonne have been heard for the HMS I/II 80/20 scrap mix in early April.

In Japan, Tokyo Steel continued to take the knife to scrap prices in the early part of March, cutting payments for incoming volumes of the H2 grade by upwards of US$ 50 per tonne. But in the final week of the month, the company reversed this trend by increasing delivery prices to its main Utsunomiya plant by some Yen 1000 to Yen 30 000 per tonne (equivalent to US$ 289 at the time of writing). However, the prices paid by its other leading works remained unchanged.

The 65 countries reporting to the World Steel Association generated 124.99 million tonnes of crude steel in February (+0.6% year on year) for a two-month cumulative total of 261.686 million tonnes, which equates to a gain of 1.6% or more than 4 million tonnes over January-February 2013. Capacity utilisation across the same countries averaged 77.6% in February this year, a drop of two percentage points from the same month in 2013 but an increase of 0.7 percentage points over January 2014.

The full version of Recycling International’€™s latest ferrous market analysis will appear in its April 2014 issue.