Davis Index’ northern Spain HMS 1&2 (80:20) and shredded ferrous scrap small bulk weekly indices rose by €7/mt ($8/mt) to €222/mt and €232/mt cfr, respectively, on Friday.
Spanish mills were obliged to pay higher prices compared with the prior week to secure imported scrap cargoes despite a backdrop of flailing steel consumption and production.
Moreover, tighter ferrous scrap supply availability among many bulk exporters, holding short positions, has been exacerbated by a recent flurry of fresh Turkish bookings over the same period.
One Spanish ferrous scrap buyer lamented having to pay what they considered “expensive” prices for seaborne cargoes, given decimated domestic steel production schedules and scrap demand.
Furthermore, domestic steel consumption will be further impinged by Nissan Motor’s decision on May 28 to close its Spanish vehicle production plants in Avila and Barcelona. As the Japanese auto manufacturer executes a restructuring strategy to reduce global capacity, this move will eliminate production of around 120,000 vehicles per annum from the Spanish market.
Davis Index’s UK small bulk ferrous scrap HMS 1&2 (80:20) and shredded indices jumped by €20/mt and €25/mt over the same period to €209/mt fob and €219/mt fob, respectively, on Friday.
UK small bulk ferrous scrap prices climbed at a much faster pace by comparison as they played catch up to developments in major seaborne trading routes.
(€1 = $ 1.11)