Turkish HMS 1/2 80:20 import prices decline 5.6% m/m during April

ANKARA (Scrap Register): Turkish HMS 1/2 80:20 scrap import monthly average prices (CFR Iskenderun Port, Turkey) declined by 5.6 percent month-on-month to $270.11 a ton during the month of April, as per the latest figures from the Steel Index.
Scrap prices remained range bound for April, staying between $263 a ton and $275 a ton, as political uncertainty and tepid demand in Turkey kept buying activity suppressed for much of the month.
Sentiment has become increasingly bullish however as the month closed, with market participants optimistic for an uptick in demand moving into May.
April saw the scrap price in Turkey remain range bound, with the price fluctuating between $263 a ton and $275 a ton. The political situation in the country undoubtedly dampened the market, leading to a fairly quiet scrap market through the latter half of the month.
President Erdogan won the referendum in Turkey on April 16, granting him unprecedented power. The uncertain political landscape in Turkey this year has certainly impacted the appetite of mills, and this event was no different.
Mills retreated from the market prior to the referendum and took well over a week to reappear. Uncertainty about the lira’s performance against the dollar during this time was a cause for concern, along with dampened domestic demand for rebar.
Trading activity was however healthy at the start of the month as good domestic rebar demand spurred buying activity and saw the scrap price rise to $274 a ton.
Scrap prices saw some support from moves in the coking coal market, which skyrocketed at the start of the month as force majeure was declared by a number of Australian producers in the wake of Cyclone Debbie.
The large price hikes in the coking coal price made steel production via BOFs far more expensive than steel production via EAF. TSI’s model of the two means of production showed a US$20/tonne crude steel differential between the two when coking coal was at its peak of US$314/t in mid-April.
The support for the scrap market during the start of the month faded as the coal price fell off, and bearish sentiment out of Asia and the US weighed in on the market. Lack of buying by the mills following the referendum saw the price for imported HMS 80:20 scrap slip to US$263/t towards the end of the month.
At the close of April, sentiment switched, with rebar prices gaining ground, improving margins for mills. The spread peaked at $157 a ton on the last Thursday of the month. Sentiment also became more bullish as demand returned, mills began to buy again, and the outlook for May looked increasingly positive.