Tension in the Turkish market for imported steel scrap stoked volumes on the London Metal Exchange's contract Thursday.
Over 3,000 lots were traded on the exchange, at 3,048, equating to 30,480 mt of material -- enough to hedge the heavy melting scrap I/II (80:20) portions of a couple of deep sea cargoes.
This was only the ninth highest trading day since the contract's inception, but August has made a strong start in terms of volume.
Over the first eight trading days of the month lots traded have already surpassed half of July and January's volumes, which are the contract's record months to date.
The strong trading day came as participants expected the market to reach $350/mt CFR Turkey for HMS I/II (80:20).
S&P Global Platts assessed Turkish imports of premium HMS I/II (80:20) at $340/mt CFR Thursday.
Late Thursday two physical trades were reported above these levels.
Firstly, a global merchant sold out of Australia and New Zealand 11,000 mt of 80:20 at $354/mt CFR, 6,000 mt of shredded at $359/mt CFR and 13,000 mt of bonus at $364/mt CFR for a latest shipment date of October 5.
A trading house was also said to have sold ex-US 80:20 at $353/mt CFR, shredded at $358/mt CFR and bonus at $363/mt CFR, for a latest shipment date of October 15.
This second shipment originated from Tampa, Florida, which typically carries a premium to US East Coast material.
Australia-Turkey is an irregular trade flow, with US, European and Baltic states the major sellers into the world's largest buyer of seaborne scrap.
"Other than Bangladesh, seems no Asian market has ever tried to keep up with Turkish pricing," a European seller into Turkey said.
"So at some point FOB equivalent arbitrage weighed in favor of Australia to Turkey," he added, saying he had not seen Australia sell into Turkey before.
Some sources, however, said there was a trade from Australia in 2012.
