LME scrap volumes increase on week; futures contracts in contango

Volumes traded for the scrap futures contracts on the London Metal Exchange, which settle basis the Platts assessment, increased week on week.

Weekly LME scrap futures trading volumes in the week to Oct. 31 increased slightly to 281,910 mt, up from 218,830 mt in the week to Oct. 24.

Platts assessed spot prices for physical imports of premium heavy melting scrap 1/2 (80:20) down by $2/mt on the week and at $363/mt CFR Oct. 31, amid stable collection costs in the Benelux region and cautious optimism from traders ahead of the US presidential election, as industry participants weigh the potential for a market rebound against the backdrop of geopolitical uncertainties and fluctuating demand.

The October-January portion of the forward curve for Turkey scrap futures on the LME entered a sharp contango structure, indicating a market expectation of rising prices in the near term.

Rebar futures volumes traded on the LME decreased in the week to Oct. 31 as market sources continued to report a wide bid-offer spread which limited market activity.

Weekly LME rebar futures trading volumes decreased to 7,660 metric tons in the week to Oct. 31, down from 10,250 mt in the week to Oct. 24.

The October-January portion of the forward curve for Turkey rebar futures on the LME maintained a contango structure, indicating that futures traders expect Turkish rebar prices in the physical market to follow an upward trend in the near term.

Platts assessed Turkish exported rebar at $590/mt FOB on Oct. 31, down by $2.50/mt on the week to Oct. 24.

Platts is part of S&P Global Commodity Insights.