Turkiye: Deep-sea scrap market largely stable amid cautious mill buying

• Weak steel demand continues pressuring scrap purchases
  
  
• Billet price cuts dampen import market sentiment
  
  

Turkish deep-sea imported scrap sentiment remained weak during the week ended 11 June, with mills largely staying away from the market amid sluggish finished steel demand and continued pressure on steelmaking margins. Buying activity remained limited, with producers focusing on rebar sales before returning to the scrap market, while abundant scrap availability continued to weigh on sentiment.

Price assessments

• US-origin HMS 80:20: around $406/t CFR Turkiye, stable w-o-w.
  
  
• US East Coast HMS 80:20: around $371/t FOB, down $2/t w-o-w.
  
  

Meanwhile, the scrap-to-rebar spread remained tight at around $183-184/t, while export rebar offers were heard stable at approximately $590/t FOB. Meanwhile, Russia-origin billet offers around $520/t CFR Turkiye, China-origin billet offers around $530/t CFR Turkiye.

Market updates

A Baltic scrap market participant said the market may be nearing a floor, as Turkish mills have only a short window left to complete July-shipment scrap bookings. However, most buyers continued to stay on the sidelines, waiting for clearer market direction.

"The latest deal heard in the market was concluded last week, with a Poland-based supplier selling scrap to a Turkish mill at $402/t CFR for July loading," the participant said.

Despite some optimism around scrap, sentiment in the wider steel market remains weak. Turkish domestic billet prices fell by another $10/t following fresh reductions from local suppliers, while both domestic and export demand for finished steel products remained subdued.

At the same time, billet imports continue to offer competition. Market sources heard a Turkish mill booked Chinese billet at around $520/t CFR Turkiye for August shipment. Russian billet offers have also started to move higher, with suppliers increasingly targeting Iran after recent missile attacks disrupted part of the country's steel production capacity.

Weak rebar sales and sluggish finished steel demand continue to weigh on Turkish mills' purchasing decisions. A trader noted that mills are currently focused on selling finished steel rather than rebuilding raw material inventories.

"Mills are prioritising finished steel sales and are unlikely to return aggressively to the scrap market until downstream demand improves. A few buyers are already indicating target levels around $390/t CFR for HMS 80:20," the trader said.

Outlook

Turkish mills are expected to continue purchasing scrap on a hand-to-mouth basis as weak finished steel demand and squeezed margins limit buying appetite. Although the window to secure July-shipment cargoes is narrowing, most buyers are likely to remain selective until rebar sales show a meaningful improvement. Some market participants believe the recent correction has brought scrap prices close to a floor, which could help stabilise the market and limit further downside.