European contracts for import /export of scrap are falling

European contracts for the import /export of scrap from France and Germany to Italy and Spain for June are in the process of closing lower by 10 euros /tonne ($ 11.2 /tonne) compared to May. However, not all contracts have been signed and some of them may be negotiated at a price lower by 5 € /tonne depending on the quality.

Contracts for the export of ferrous scrap are agreed in the middle of each month. “The Italian factories are currently operating with reduced capacity, because the final demand for long products in the domestic market remains rather heterogeneous, and the market is uncertain,” comments an Italian trader. A French trader says a similar demand situation has been reported in Spain, where rebar prices and sales are not particularly buoyant. However, Spanish factories require inferior quality scrap compared to Italian ones.

New mixed quality shipments from France and Germany to Italy are in the process of reaching € 270 /ton for the lower quality and € 280 /ton on average for the higher grade. Import /export contracts will be closed this week.

The European scrap market remains uncertain and is following the downward trend in Turkish scrap. “However, it is possible that mills will resume purchasing higher amounts of scrap by mid-July to replenish their stocks before the summer shutdowns in August in France, Spain and Italy. This could cause a slight increase in the next month, ”comments the source.