Italian steelmakers have been still in need of attracting additional ferrous scrap in mid-January. In spite of continuously growing prices for the material, the mills are ready to buy it as this month they have new orders for finished products to fulfill. At the same time, supply of the material in the country still does not suffice to fully meet the producers' needs, thus making them revise their purchase prices upwards weekly.
In particular, prices for shredded scrap (E40), which steelmakers show the most demand for, have reached EUR 410-415/t ($549-555/t, EUR 1 = $1.33) CPT. As previously reported, last week quotations of E40 were at EUR 390-400/t ($504-516/t) CPT. Stronger euro, gaining 4 points in the foreign exchange market in a week, has contributed to an increase in US dollar-denominated prices to some extent.
Quotations of lower-quality HMS 1&2 (80:20) (E3) have added EUR 15-20/t CPT from early January, and the mills are paying EUR 375-380/t ($502-509/t) CPT for the material. In turn, offers of high-quality bushelings material (E8) have grown to EUR 425/t ($569/t) CPT, while last week its prices have been about EUR 400-410/t ($518-531/t) CPT.
Prices for scrap, imported from France and Germany, have also grown. Average quotations of the material from these countries have increased by EUR 10-15/t, reaching the following levels: shredded scrap (E40) – EUR 395-400/t ($529-535/t) CPT, HMS 1&2 (80:20) (E3) – EUR 375/t ($502/t) CPT.
Currently, quotations of ferrous scrap in Italy are the highest in the world market, and in view of a decline in buying activity in the Turkish market, where some suppliers are reportedly ready to reduce prices already, Italian traders expect the similar course of events in the local market. In spite of pending orders, it is getting difficult for steelmakers to reflect growing scrap costs in their prices for finished products. However, quotations of scrap will hardly fall soon in Italy, provided the lull in the Turkish market proves to be short-lived and end-users keep showing demand for steel products.
Amid shortage of the material in Italy, local traders are ready to import it. In particular, a batch of shredded scrap from USA (about 30,000 tonnes), purchased at $460-480/t C&F Venice before holidays is expected to arrive on January 23. In turn, last week the similar batch was bought at $530/t C&F Venice (February shipment).
At the same time, while importing quality material, Italian traders keep exporting local HMS 1&2 (80:20) (E3). In particular, the latest bookings of the material to Turkey have been made at $500-510/t C&F.
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