The global scrap steel market in late July 2026 is defined by a standoff. Turkish deep-sea HMS 1&2 80:20 import prices are trading in the $373-383 per tonne CFR range, according to cargo data from Platts and SteelOrbis. That sits below the April 2026 peak of $404/t CFR but above January lows of around $365/t. Neither buyers nor sellers have enough leverage to break the range. Turkish mills are buying selectively at the lower end, while US and European exporters resist dropping below $370/t CFR on elevated collection and freight costs.
Turkey remains the pricing anchor for the global deep-sea scrap trade, and the countrys EAF-based steel sector is the marginal buyer. Right now, Turkish mills are operating at reduced capacity. Weak domestic and export rebar demand has limited their need for ferrous feedstock. GMK Center reports that Turkish rebar mills are operating with weak or negative margins, with high imported scrap costs from the US and Europe compressing profitability on one side and weak demand preventing price pass-through on the other. A recent US East Coast cargo of HMS 80/20 was booked at $373/t CFR — at the lower end of the range — while a mixed cargo including shredded at $403/t CFR, HMS 95/5 at $398/t, and plate and structural at $408/t CFR shows the spread across grades.
The scrap steel CFD benchmark tracked by Trading Economics provides a broader view. It stood at $402.50 per tonne on July 23, up 5.37% month-on-month and 16.7% year-on-year. The year-on-year gain reflects cumulative cost-push from higher energy prices, elevated ocean freight, tighter collection networks, and structural demand from the growing global share of EAF steelmaking capacity. Even with weak Turkish demand, scrap values are holding at levels well above the 2024-2025 average, suggesting that the floor has structurally shifted upward.
The shredded scrap premium over HMS 1&2 80:20 remains intact at around $20-25 per tonne. Argus assessment commentary from June noted exporters seeking a minimum $20/t premium for shredded into Turkey. Shredded scrap into Turkey was broadly indicated at $395-410/t CFR in late June to early July, depending on origin and cargo mix. This is relevant for procurement teams who can adjust their charge mix — substituting shredded for HMS can improve melt quality but at a cost premium that has held steady through the summer lull.
On the supply side, US East Coast exporters remain the dominant source for deep-sea cargoes into Turkey. European scrap flows, which typically supplement Turkish demand alongside feeding regional EAF mills in southern Europe, are constrained by relatively balanced domestic demand within the EU. US domestic shredded was reported around $380-388 per tonne for export-related transactions, generally at parity with deep-sea pricing. Plate and structural scrap commanded the highest premiums, with bulk cargoes reported at $408/t CFR Turkey, reflecting the tighter supply of heavy melting grades.
The Turkish rebar-scrap spread — the key margin indicator for Turkish mills — remains compressed. With rebar export prices at $520-525/t FOB and scrap costs at $373-383/t CFR, the spread is roughly $140-150/t before conversion costs, energy, labor, and freight. Industry estimates suggest Turkish EAF mills need a minimum spread of $180-200/t to operate profitably. The current compression explains why Turkish mills are bidding conservatively and why some production cuts are likely if the spread does not widen.
The near-term outlook depends on two variables: Turkish rebar export demand and US Fed policy. If the Fed cuts rates in September as the market currently expects, and post-summer rebar demand recovers in the US and Middle East, Turkish mills could ramp up utilization, tightening scrap demand and pushing HMS 80/20 back toward $390-400/t CFR. If rebar demand remains soft through Q3, scrap prices could slip toward $360-370/t CFR — the level where higher-cost EAF mills would cut output rather than accumulate unprofitable scrap positions. The stability of July 2026 feels like a temporary equilibrium, with the balance of risks tilted modestly to the downside.
The global EAF capacity expansion is the structural story underneath the scrap market. As blast furnace capacity retires in Europe and North America, and as new EAF mini-mills come online, the demand for scrap as a primary feedstock is growing. In the US alone, multiple new EAF projects are scheduled for commissioning through 2027-2028. This structural demand growth should provide a long-term floor for scrap prices, even as short-term cycles driven by Turkish rebar demand create volatility. The current 02.50/t CFD benchmark, 16.7% above year-ago levels, already reflects this structural shift. Cycles may swing prices lower temporarily, but the long-term production cost floor has moved up. For buyers, this means that any significant dip in scrap prices below 60-370/t CFR Turkey would likely be short-lived, as the EAF capacity expansion creates an underlying demand pull that reacts to lower prices by increasing buying interest from new mills that cannot substitute with iron ore and coke in the way that integrated BF/BOF mills can. As blast furnace capacity retires in Europe and North America, and as new EAF mini-mills come online, the demand for scrap as a primary feedstock is growing. In the US alone, multiple new EAF projects are scheduled for commissioning through 2027-2028. This structural demand growth should provide a long-term floor for scrap prices, even as short-term cycles driven by Turkish rebar demand create volatility. The current 02.50/t CFD benchmark, 16.7% above year-ago levels, already reflects this structural shift. Cycles may swing prices lower temporarily, but the long-term production cost floor has moved up.
Regional supply dynamics are also evolving. US scrap generation remains relatively stable, driven by industrial production, demolition activity, and the automotive sector. However, the quality mix is shifting. Prime grades are becoming relatively scarcer as manufacturing processes improve yield and reduce waste, while obsolete scrap from demolition and end-of-life vehicles maintains steady flow. This quality shift has implications for Turkish mills that traditionally rely on a mix of HMS 1&2, shredded, and plate and structural scrap. As prime generation tightens and shredded production requires more energy-intensive processing, the premium for higher-quality scrap grades may widen over the medium term.
European scrap markets show a different dynamic. The EU generates roughly 90-100 million tonnes of scrap annually, with a significant portion flowing to Turkey. However, European EAF capacity is also expanding as part of the green steel transition, with several major projects in Germany, France, and Spain. This growing domestic demand may reduce the volume of scrap available for export to Turkey over time, particularly as CBAM implementation increases the cost of importing semi-finished steel versus scrap. For Turkish mills that depend on European scrap flows, this represents a structural tightening risk that could push deep-sea scrap prices higher in 2027-2028, independent of the short-term rebar demand cycle.
Turkish and European buyers should target HMS 80/20 CFR at the lower end of the current range ($373-375/t), particularly for larger deep-sea cargoes where freight advantages can be negotiated. The market lacks upward momentum, so there is no urgency to cover forward positions aggressively. For US and European scrap generators, expect stable export pricing through August, with potential upside in September as post-summer restocking resumes. The key variable to track is Turkish rebar export pricing — if Turkey regains competitive footing (particularly for US infrastructure demand), scrap demand will tighten rapidly. With the CFD benchmark at $402.50/t up 16.7% YoY, underlying scrap supply costs have structurally increased. Buyers planning annual or semi-annual contracts should build in a minimum $380-400/t baseline for deep-sea HMS 80/20, with upside risk from any Turkish mill utilization recovery and downside risk from a sustained rebar demand downturn.