The march of the coronavirus around the world results in expected shock to global commerce. Sims and EMR have stopped collections of metal scrap from third parties in the UK and many facilities in the US were also closed down for now.
Ultimately, with many of the ferrous scrap hot spots in lockdown, trade inevitably slowed to a near halt. On the Turkish scrap market, stunning price crashes were seen during March, with a series of cargo transactions falling more than US$ 70 per tonne.
Prices at the end of February had mirrored those in the previous issue, with a US cargo of HMS I/II 80/20 selling at US$ 280 per tonne. Trading then paused for two weeks before the hiatus was ended by lower-priced trades, a US cargo of HMS I/II 80/20 moving for US$ 275 per tonne and a Baltic sea cargo secured at US$ 268 per tonne.
Prices continued to move down during March as the coronavirus outbreak reached Turkey and reduced demand further. Another US booking of an average cargo of other grades with HMS I/II 80/20 was valued at US$ 249 per tonne. A UK cargo booked at US$ 226 per tonne laid bare the weakness of the global export market.
Coronavirus continued to impact on trading, with various production cuts and steel mill closures in Turkey. By the month end, there were further price drops with two Baltic Sea cargoes pricing HMS I/II 80/20 at US$ 206-207 per tonne.
At the time of writing in early April there had been a limited turnaround in sentiment, with a small increase in prices expected due to a short supply of material, yards closing and smaller collections of material in the main exporter countries such as the US and the UK due to the coronavirus spread.
*The full ferrous market analysis will be published in our the upcoming issue of Recycling International.
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