Last week (July 23-30) metallurgical enterprises of Ukraine significantly increased purchase prices from 7800 to 9600 hryvnia per ton. At the same time, the association of scrap collectors says that the profitability of scrap metal purchases has significantly decreased, but is higher than the standard value.
Scrap metal supplies to metallurgical plants decreased to 61.4 thousand tons compared to 63.9 thousand tons a week earlier. The demand for scrap was 60.2 thousand tons. The level of satisfaction of demand for scrap in the domestic market last week amounted to 103%.
Remains of scrap in the warehouses of steel producers decreased from 224 thousand tons in the previous week to 190 thousand tons. Inventories in working days are 23 days, which is 2 times higher than the standard value. The highest stocks at Dneprospetsstal - 58 days. The lowest - at Azovstal - 11 days.
The growth in the price of scrap metal in Ukraine is taking place against the backdrop of a fall in world quotations. The operating price range in the Turkish market was $ 470-480 per tonne compared to $ 480-490 per tonne in the period July 17-23.
In the Asian market, the cost of scrap metal is also declining. Traders understand the inevitability of a further continuation of the downtrend and rush to unload the accumulated raw materials. On the other hand, factories are very selective in their approach to procurement, since they have a significant number of alternative proposals.
Analysts believe that in the near future, scrap metal quotes will continue to move downward due to the importing of balances to the normative level and overheating of the market. The increase in supply from the US and EU exporters will also exert pressure on prices. However, the decline in prices will not be significant - low rates of scrap collection in the United States and high prices in the domestic markets of the largest exporting countries will limit the scale of the decline. The forecasted range of world scrap prices this week is $ 465-475 per tonne of CIF.
