Turkish ferrous scrap prices expected to remain firm

Market sources expect a solid first quarter although the crisis in the Red Sea has affected the movement of containerised scrap.

Prices for Turkish imports of ferrous scrap increased sharply throughout Q4 2023. Mills restocked their inventories as sellers kept offers firm, with prices settling between US$ 420-425 per tonne CFR in the New Year.

Platts assessed Turkish bulk imports of premium heavy melting scrap 1/2 (80:20) at US$ 422 per tonne CFR on 17 January, climbing from an October 2023 low of US$ 351.75 per tonne.

After a round of restocking in December and early January at elevated levels to support a flurry of rebar sales in both the export and domestic market, recyclers have maintained high offers as scrap availability was said to have remained seasonally tight. This has kept collection costs in the Benelux and the Baltic regions relatively firm in recent weeks.

HMS collection costs in the Baltic region were recently shared at EUR 345 per tonne delivered to the docks, while prices in the Benelux region were reported at around EUR 5-10 less.

Red sea crisis

The containerised shredded scrap market has also been adversely impacted by the ongoing conflict in the Red Sea, which caused container freight rates for exports from the UK and Europe to India to almost double within a month, thereby making imports of such scrap unworkable for Indian buyers.

Attacks by Houthi rebels in Yemen on commercial vessels forced shipping lines to divert their fleets, using the Cape of Good Hope and adding about nine days to a typical journey from Taiwan to the Netherlands. 

Platts assessed imported containerised shredded scrap at US$ 407.50 per tonne CFR Nhava Sheva on 12 January as Indian buyers held back.

As a result, the weekly CFR Nhava Sheva containerised prices stood at a rarely seen discount to CFR Turkey import HMS prices, a situation last seen in April 2022.

The discount stood at US$ 15.50 per tonne in mid-January despite Indian prices historically averaging a US$ 23.31 premium over the weekly average of the Platts CFR Turkey premium HMS 1/2 (80:20) assessment.

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