Approaching June trading, scrap prices in the US are expected to fall further amid pressured finished steel prices, Kallanish notes.

Although scrap values have rebounded in Turkey, the largest export destination, and supply is tight despite favourable weather conditions, most market participants see a further fall being inevitable.

Flow is seen to have failed to improve, contrary to expectations, despite improved weather conditions. However, as prices for both hot rolled coil and rebar are following a downward trend, mills are likely to pressure scrap prices down.

On the other hand, market participants think US mills will not show a serious buying appetite for scrap. Consequently, most market participants are seen expecting prices to slide by $20-40/gross ton, depending on grade and region.

Besides the Turkish market, the Taiwanese scrap market also saw an increase last week due to firm offers. Offers for containerised US-origin HMS 1&2 80:20 scrap have been raised to over $365/tonne cfr Taiwan, up $2.5/t from the previous week.

In Turkey, although mills were targeting to buy premium HMS 1&2 80:20 at around $375/t cfr Turkey, suppliers remained firm with their offers and refused to sell at these levels. Consequently, Turkish mills have been forced to pay $385/t cfr for premium HMS 1&2 80:20.