Published on November 27, 2024
In November 2024, the global scrap market experienced a significant price decline, driven largely by weak demand for steel. This decline was consistent across several key markets, including Turkey, the United States, China, and various European countries. The month saw scrap supply surpassing demand, leading to lower prices and a challenging market environment for sellers.
Turkey’s Market Dynamics
In Turkey, scrap supply fell to its lowest level in two years. The price of HMS 1&2 80:20, a common grade of scrap metal, dropped by 5% to $344-345 per ton CFR (Cost and Freight). This price reduction continued the downward trend in October when prices fell by 1.4%. The Turkish market faced an oversupply of scrap, particularly from European and UK sources, which met the needs of Turkish steel mills but also exerted downward pressure on prices.
United States Market Trends
The US scrap market also experienced a decline, with prices falling by 3.6% in November. This decrease was attributed to weak demand, low export quotations, and falling steel prices. Despite expectations for price stabilization at the beginning of the month, a reduction in contract orders from steel mills created uncertainty, particularly in the Southeastern US, where oversupply was a significant issue. The US East Coast prices for scrap metal stood at $321-324 per ton FOB (Free On Board) by the end of the month.
China’s Market Situation
In China, scrap prices fell by 2.7% to $343.3 per ton for heavy scrap. Lower domestic steel prices, oversupply, and limited demand from electric arc furnace (EAF) steel mills influenced the market’s dynamics. After rapid price growth in October, driven by rising steel prices, the market saw a reversal in early November due to increased scrap supply and higher availability from downstream processors.
European Market Trends
The European scrap market presented a mixed picture. While some regions experienced stagnation, others saw minor price drops. In Italy, for example, scrap prices rose by €10-15 per ton early in the month but stabilized at €330-360 per ton by mid-November. This increase was driven by higher demand from local steel mills following a downturn in October. However, the market remained fragile due to planned production stoppages in December.
In Germany, scrap prices fell by €5-10 per ton to €305-310 per ton, influenced by low domestic demand and limited exports to Turkey. Similarly, prices in Austria remained stable at €300-305 per ton. In France, Belgium, and Luxembourg, prices were almost unchanged despite expectations of a decline, with E40 and E8 scrap selling for €335-340 per ton and €320-335 per ton, respectively.
Outlook for January 2025
Despite the significant drop in scrap prices in November, market participants anticipate a partial recovery in January 2025. European demand is expected to return, which could help stabilize prices. However, the market will likely remain under pressure until 2024. Steel mills that have cut production have met the minimum demand for December, and weak demand for steel does not provide a strong basis for a substantial increase in scrap prices in the short term.
Conclusion
November 2024 was marked by a global decline in scrap prices, driven by weak steel demand and an oversupply of scrap metal. While a partial recovery is expected in early 2025, the market will face challenges from low demand and ample supply. Market participants must navigate these pressures and adjust their strategies to remain competitive in the evolving landscape.
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