Steel scrap prices up in Russia

It is reported that inflation expectations of 2011 furthered metallurgical raw materials prices increase in the 4th quarter of 2010. Scrap, iron and steel finished products prices followed the increase in iron ore global market.

Turkish scrap exporters turned back to Russian and CIS markets due to prices boost in Turkish market, which was caused by limited offers from Europe and the USA. The US scrap suppliers increase the prices due to domestic consumption growth and imports from China. The latest offers from the USA are at the level USD 445 per tonne to USD 450 per tonne for HMS1&2 80:20 and SHROT correspondingly.

In Europe bad weather conditions resulted in scrap collecting volumes decrease. This caused prices boost in EU domestic market. Thus European exporters increase their prices as well. In this situation scrap prices at Azov and Black sea ports are almost the lowest. Eventually spot prices hiked to USD 415 per tonne to USD 420 per tonne C&F. January offers reach USD 440 per tonne C&F.

Scrap prices jump in global market affected Russian domestic prices. During recent weeks exporters’ buying prices in Rostov port were not lower than RUB 9,100 per tonne to RUB 9 200 per tonne. Currently the port stevedores’ prices are RUB 9400 per tonne to RUB 9,500 per tonne and continue to grow.

Russian local consumers have to follow exporters’ prices. The buying price at steel mills in Russia have to be at least by RUB 100 to RUB200 rubles higher than at a port. Thus, the competition between steel mills and the exporters of south of Russia is expected.