Ferrous complex saw inputs of scrap and iron ore fall whilst semi-finished HRC and Rebar were higher. Notably Iron Ore was sold off losing 18% value over July.
Turkey Scrap was weaker losing 6% as supply wasn’t tight and dockside stocks grew in Europe and US. Demand was quiet around Eid.
Futures activity and liquidity remained in the nearby months. Both LME Scrap and Rebar futures forward curves in a nearby contango as the market anticipates a recovery in prices with scrap restocking in Turkey and rebar demand from China.
Turkish steel re rolling mills margins over the last few months as shown by the Scrap-Rebar of $235/mt is at some of highest levels seen for years.
Iron ore was sold off in July losing 18% as China domestic demand came off following anticipation of steel production cuts in order to meet their strategic emissions targets. Coking coal remained tight adding +9%. Chinese HRC prices recovered in July steadily through the month to $936/mt.
US HRC continued to increase, adding $83/st on the month, averaging $1,785 on continued tight supply and strong demand.
HRC Europe was largely flat overall (+EUR 10/mt) in a fairly stable market but a divergence with Southern Europe prices weaker.