German steel scrap prices reach highest level since 2014

22 September 2017

The upward trend on the German ferrous scrap market that started in June continued in September, bringing prices to a level not seen since January 2014. At the beginning of the month, prices took an initial jump before being scaled back as the month went on. Most recently, however, there were cases in which buyers were paying only July prices.

Due to the Muslim holiday Eid al-Adha at the beginning of September, orders from Turkey were somewhat more subdued. Furthermore, there were more competing offers from the USA and the strong euro also had a dampening effect. Buying patterns in Turkey continue to play a key role in the market, according to insiders. With steel exports from China down, Turkey continued to have excellent sales opportunities, which suggested that demand for scrap would stay stable, traders said. Merchants were not too upset about the weaker sales to Turkey in September, noting the large volumes had been sold in August.

German steel mills are also pretty busy, with structural and sheet steel producers reporting excellent activity levels. The same was true for foundries. Only the beams segment was not quite as strong. Despite the strong activity levels, growing uncertainty is evident on the market. Although capacity utilisation is very good, the mood is more subdued.