Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Davis Index’ weekly northern Spain HMS 1&2 (80:20) and shredded ferrous scrap small bulk indices edged down by €5/mt ($5/mt) to €215/mt and €225/mt cfr, respectively, on Friday.


Spanish steel production, and ferrous scrap consumption, has remained relatively subdued in response to weak downstream demand, reduced operating rates, and an unconfirmed mill outage.


Benchmark Spanish ferrous scrap import tags largely followed cues set by developments in the European export and Turkish deep-sea and short-sea import markets this past week.


Spanish ferrous scrap import prices came off €10/mt at the beginning of this week, as European suppliers passed on discounts negotiated with local merchants. As the week progressed, a flurry of Turkish purchasing activity resulted in major benchmarks rebounding to partially recover some of the declines witnessed earlier in the week.


The Spanish market saw a demonstrable increase in offers this week, particularly for shredder scrap grades from UK and European suppliers, a Spanish ferrous scrap buyer commented. In addition to an increasing number of merchants returning to work across the UK and EU, it is rumored that some bulk exporters are offering 45-day delivery terms and holding short positions. 


All signs point to a lack of confidence in the steel and ferrous scrap market fundamentals over the next month or two. However, the scales of supply and demand will be finely balanced given the short positions held by major exporters.


Any significant improvement in Turkish demand could result in a significant boost to major seaborne ferrous scrap benchmarks.


(€1 = $ 1.09)

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