Sentiment in the US scrap market, which is preparing for March trading this week, is seen to have worsened amid declining steel prices and Turkey’s plummeting import values.

Because of oversupply, scrap prices in Turkey tumbled on two US-origin deals at the end of last week, market participants inform Kallanish. Following the deal that was concluded on 28 February at $393.5/tonne for HMS 1&2 85:15 and $410.5/t cfr for shredded, a southern Turkish mill bought HMS 1&2 80:20 at $385/t and shredded at $405/t cfr Turkey at the weekend.

Turkish producers’ long pause in buying caused growing oversupply and led suppliers, who refused even $395/t cfr levels earlier last week, to accept $385/t cfr at the end of the week. Turkish producers are expecting to see even lower levels from the US this week due to the anticipated sharp falls in the US domestic market. On Monday, an offer from the US stood at $392/t for HMS 1&2 95:5 and $400/t cfr Turkey for shredded.

On the US West Coast, the situation is no brighter. Taiwanese producer Feng Hsin cut domestic scrap buying prices by another TWD 300/t ($9.5) on Monday. Although the offer levels for containerised HMS 1&2 80:20 were revised from $368/t a week earlier to $358/t cfr levels on Monday, buyer interest remained lulled.

Plummeting exports coupled with decreasing steel prices have led to expectations of US domestic scrap prices weakening further ahead of trading. While some sources are maintaining their expectations of a $50/gross ton decrease for prime grades, others think prices will fall by $20-40/gt depending on the grade and region.