Ferrous scrap prices have softened to $380-400/mt Turkish CFR in the first week of July 2026, breaking the $400-410 stalemate that held through June. The catalyst is clear: the EU steel safeguard overhaul took effect July 1, halving tariff-free imports to ~18 Mt with a 50% out-of-quota tariff. Turkiye's HRC quota (160,574t) was exhausted within hours on day one, with ~229,564t awaiting allocation — exceeding available volume by 43%. Turkish mills face a critical choice: reduce production and scrap imports, or lose competitiveness in their primary export market. Initial market reaction is bearish for scrap as Turkish buying slows. But the medium-term structural effect is bullish for scrap demand: lower steel imports into Europe means higher European EAF mill utilization, increasing regional scrap demand intensity. Simultaneously, US domestic scrap is firming — shredded grades up +6.85% WoW per IndexBox, supported by HRC at $1,145/st in its 39-week rally. The divergence between short-term Turkish weakness and medium-term structural tightening creates an asymmetric buying opportunity. Procurement posture: OPPORTUNISTIC. Secure Q3 volumes at the $380-400 dip before EU safeguard effects lift the floor.
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