The below article is from the archive an year old and is provided for illustration purposes. To get the most recent news, take the free trail. Takes a minute to complete. FREE TRIAL FREE TRIAL

Last 7 days
Price Articles

Brazilian scrap moves sideways as expectations diverge

Tuesday, 21 May 2019

Brazilian ferrous scrap prices were stable Monday, amid a dearth of deals, while market participants held mixed views on the short-term price trend.

“The problem isn't price anymore, but the lack of consumption,” said a Sao Paulo-based scrap dealer. “We can always adapt prices to the market conditions. But when there is no consumption, you can't even negotiate."

S&P Global Platts assessed Brazilian clean scrap at Real 795/mt ($194/mt). The tradable range of offers, bids and deals was Real 790-800/mt, delivered mill, no taxes included.

Brazilian heavy melting scrap I & II was assessed at Real 730/mt. The tradable range was Real 710-740/mt, delivered to mill, no taxes included.

Platts' weekly price assessment for turnings was at Real 600/mt. The tradable range was Real 580-610/mt, delivered to mill, no taxes included.

Platts' scrap survey is mainly focused on negotiations for 500-2,000 mt orders in southeastern Brazil. About 24 companies were contacted in the survey May 14-20.

Suppliers have started to fear cancellations and payment delays, according to market sources. One was said to be avoiding calling buyers for new orders to avoid them canceling previous ones.

The lack of negotiations is due to high raw materials stocks and lackluster outlook for the construction industry.

According to sources on both the buy- and sell-sides, longs producers used to work with scrap stocks of 45-60 days but are currently working with over 120 days' worth.

For the months to come, participants seemed to diverge on expectations.

“I continue seeing prices going down in June and July, until inventories reduce a bit,” the second dealer said.

Another expects some stability due to lack of negotiations.

One mill source still saw room for prices to go down to early 2018 levels, “but it will happen slowly, until the end of the year.”

Moreover, exporting is not yet a good option. “International prices remain depressed, freights costs are high and there is also a lack of containers in the [Brazilian] ports,” another dealer complained.

He added that a fair summary of the week would be: "Tears for fears."

-- Adriana Carvalho and Priscilla Antunes

© Steel Business Briefing 2019
Contact Editor privately

Steel news in English | 中文 | Português | Español | Deutsch | Italiano | Русский

© Copyright Platts 2019, all rights reserved.
Back to top  Back to top