Daily Market Note — 2026-08-17
Market commentary on the global ferrous scrap trade. Not trading advice.
The read
Two long-running unknowns moved in the same session, in opposite directions.
The Strait of Hormuz recorded its first zero. Five vessels crossed on Saturday and none at all on Sunday, against 31 the previous weekend — roughly an 84% collapse on a like-for-like weekend comparison. That framing matters: this series has been muddled for a fortnight by comparing single weekdays against ten-day averages, and a weekend-against-weekend reading removes that problem.
A zero also reads differently from a low count. Every earlier figure in this series could be argued down as undercounting, since a rising share of regional traffic runs with transponders dark. That caveat still holds for the magnitude. It cannot rescue the sign.
Meanwhile the second unknown resolved in the market’s favour: after weeks in which no public Pakistani price structure existed at all, a complete one arrived.
Key moves
The Turkish deep-sea chain broke upward. The US-origin Turkish HMS index rose $3.74 to $378.98 a tonne on 14 August data — a fresh high for the July–August rebound, moving in lockstep across every leg of the assessment chain.
What caused it is worth more than the number. A single Baltic cargo booked by a Marmara mill at $374 a tonne on Friday lifted the whole chain — a cargo priced below the index it moved. Seven bookings were reported for the week, at $367, $371.50, $371.50, $374, $375, $375.50 and $376. None was above $376 on the standard 80:20 grade. An index sitting $3 clear of every transaction that produced it is a familiar configuration, and it has corrected before.
Week-on-week, the European leg led the US leg — $4.98 against $3.98. That points to supply, not to Turkish demand.
The exchange picture inverted. The LME August scrap settlement stands at $376.50 — now below the physical index, having been above it for most of the past week. A forward price and a transacted cargo are different objects, and last week’s habit of quoting the curve as evidence of prompt value now points the wrong way.
In Pakistan, the imported shredded market showed bids around $410–415 a tonne CFR Port Qasim, offers at $415–420 with prime yards seeking $420–425, and concluded business at $412–418; the published Port Qasim shredded index eased to $412.89. Mills showed limited appetite for fresh bookings, with well-stocked buyers resisting the higher asks and monsoon rainfall in Punjab weighing on steel demand. The constraint there is inventory rather than price.
Freight and shipping
Beyond the Hormuz count, a third vessel operated by ADNOC was reportedly attacked. Brent traded near $89.28 a barrel after touching $89.40, having gained more than 5% last week — putting the widely watched $90 level within a single ordinary session’s move.
Nothing has been withdrawn from the carrier surcharge stack. Maersk’s peak season surcharge to Pakistan, MSC’s Northern Europe congestion charge and CMA CGM’s Middle East fuel surcharge all stand. On a 28-tonne container, a $500 per-box charge is $17.86 per tonne — which is why achieved payload, not nominal capacity, decides what a surcharge actually costs.
One caution on reading carrier notices: a published Pakistan-origin surcharge is an outbound charge. It says nothing about the cost of shipping into Port Qasim, though it is weak evidence that containers are tight there.
Supplier markets
The Rhine fell to another record low, shifting freight from barges to road and rail. For the first time the effect carries a price: a European exporter raised its dock buying price to €280 a tonne delivered on Friday simply to fill a vessel it had already sold, with low water delaying material already committed. One exporter expects no relief for at least three more weeks.
That is an availability problem wearing a price tag. A seller paying up at the dock to fill a sold vessel is short of deliverable material, not short of margin — and it makes port-adjacent supply structurally more attractive than inland material, whatever the yard price says.
Elsewhere, US export activity picked up as Turkish buyers covered September, while export prices held despite softer US domestic scrap. In Bangladesh, ship-recycling safety and regulatory risk rose after a fatal incident at a yard reported to lack valid environmental clearance; separately, Bangladeshi import bookings concluded below the prior week’s levels.
Non-ferrous snapshot
Copper was reported among the leading base-metal gainers in Monday’s Asian session and remains near record territory. Exchange officials for the day were not yet available at the time of writing, so Friday’s references stand: copper around $14,134 a tonne, aluminium around $3,246, zinc around $3,764 on a three-month basis.
Worth carrying, because it is the most common way a cable parcel gets overpaid for: gross contained metal value is not a price. Processing, freight, financing, inspection, claims and margin all come off it — and the recovery rate that determines contained value has to be verified, not assumed.
Glossary
- CFR — Cost & Freight; the quoted price includes ocean freight to the buyer’s port.
- HMS 80:20 — Heavy Melting Scrap, an 80/20 mix; the most traded bulk ferrous scrap.
- Index vs deal tape — an index is an assessor’s view of the market; the deal tape is the list of cargoes that actually traded. They can diverge.
- Backwardation — when metal for immediate delivery costs more than metal for later delivery; usually a sign of prompt tightness.
- Recovery rate — the percentage of saleable metal actually obtained from a mixed parcel after processing.