Approaching April trading, the current downswing in Turkish scrap prices is seen to have weakened sentiment in the US domestic scrap market, notes Kallanish.

Although no market participants expected a downtrend until last week, the last US-origin bookings in Turkey increased the likelihood that prices might turn down, specifically for cut grades.

On Friday, a Turkish long steel mill bought two cargoes from the US (see Kallanish passim). The first US cargo, comprising 25,000 tonnes of HMS 1&2 80:20 at $444/tonne, 12,000t of shredded at $464/t and 3,000t of bonus grade at $464/t cfr Turkey, is for April shipment. The other cargo was booked at $446/t for 30,000t of HMS 1&2 85:15 and $461/t cfr for 15,000t of shredded, for May shipment.

“We were not expecting this,” says a US scrap supplier who thought no US supplier would accept to sell HMS 1&2 80:20 at below $455/t cfr Turkey.

A US mill source says: “I am not sure about busheling due to supply and demand imbalance but I believe prices of both cut grades and shredded will fall. Busheling prices still have the potential to remain sideways.”

Price direction in Turkey is still unclear, meanwhile, as only one producer returned to the market on Friday while all others continued to halt scrap purchases.

“No revival in Turkish scrap demand is expected unless steel sales and prices recover,” says a Turkish steel producer. “The continuity of weak scrap demand is likely to push scrap prices lower.”

On the West Coast, the market is no different than in Turkey. While demand for US-origin containerised HMS 1&2 80:20 remains weak amid financial market turmoil, falling steel prices and an increase in electricity prices from April, prices recorded a sharp drop in fresh bookings at $415/t cfr Taiwan last week.