During the 18th week, the CIS export markets were governed by mixed trends. On the one hand, the CIS scrap exporters availed of their opportunity to slightly increase their prices as Turkish consumers renewed their purchase activities. On the other hand, the CIS flats market continued to deteriorate under the weight of low demand. The Russian and Ukrainian semis and longs markets entered into some sort of stability due to the support of the strong domestic markets. In the Ukrainian and Russian domestic markets the price decrease trend in the scrap segments continued during the course of the week in question. However, the new wave of scrap price increases initiated in the first week of May may once again direct the domestic markets towards a trend of upward movement. In the CIS domestic longs market a price rise for almost all product categories continued during the week in question. Meanwhile, the domestic flats markets were characterized by diverse tendencies.
Scrap: export markets look for opportunity
During the 18th week of the year, relatively high activity levels were observed in the Black Sea region scrap market. Turkish scrap consumers, who had been absent from the market, renewed their purchases in the first week of May. On the price side, CIS-origin A3 scrap saw a small upward rise mainly due to the increase in deep-sea scrap purchase activity. However, not many offers have been coming from the Russian and Ukrainian scrap exporters because of the May 1 and later the May 9 celebrations.
The Russian domestic scrap market was characterized by a price leveling trend in the first week of May. Thus, whereas two weeks ago the domestic steelmakers based in the European part of the country had lowered their procurement scrap prices, during the week ended May 6 steelmakers in the Ural part of the country decreased their procurement scrap prices by Ruble 200-400/mt ($8-16/mt). However, this regional change affected only the upper end of the Russian domestic scrap price range, lowering it to Ruble 5,900-7,400/mt ($227-284/mt).
A hope for stability was lost in the Ukrainian domestic scrap market during the week ended May 6, when domestic prices for A3 grade scrap saw yet another decrease. Although in previous weeks scrap prices in Ukraine were on a trend of slight decrease, during the week in question the scrap price dropped UAH 15-20/mt ($3-4/mt), returning to its previous average weekly rate of decrease.
However, in the light of the new developments in the Black Sea region export market, a price race in the domestic markets as well as competition with exports for better prices should be expected in the near future.
Long Products: temporary calm observed in CIS export markets
Due to the May holidays, during the 18th week of the year Russian and Ukrainian billet exporters showed very little sign of activity in the export markets. The price fall, which was seen for CIS-origin billets during the 17th week, came to a halt in the 18th week, with traders increasing their prices slightly. In addition, CIS billet producers announced a small price increase for their products after the May 1 holiday.
During the 18th week, the CIS-origin longs market entered into a period of calm, with prices for Russian and Ukrainian products retaining their previous levels. Although in previous weeks price decreases for some longs were registered in the CIS export markets, during the week in question the export prices were supported mainly by the strong purchases and new price rises in the Russian domestic market.
Long products continued to rise in price in the Russian domestic market during the first week of May. In particular, a $13/mt increase in rebar prices and a $ 9/mt increase in wire rod prices were registered. In addition, as the summer season approaches, more and more imported products can be seen in the warehouses of domestic traders, and these are apparently being offered at lower prices than domestic products.
The Ukrainian domestic longs market entered a stable phase during the week ended May 6, with only small fluctuations observed in the structural steel segment. However, the calm in the market could be better explained by the three-day holiday in the Ukrainian market during the 18th week, rather than by any market factors.
Flat rolled: CIS flats prices continue to decrease
During the 18th week, a slightly decreasing trend in the CIS flats export market continued. However, this trend affected only Russian and Ukrainian origin CR, which decreased in the course of the week by $5-15/mt, depending on the delivery region and the material specifications.
Somewhat mix trends governed the Russian domestic market during the first week of May. On the one hand, a price rise announced by the majority of producers in May to the amount of 10-15 percent pushed retail prices for CR up by $26/mt and HR up by $5/mt. On the other hand, the price rise in the Ural regions of Russia was twice as high compared to the price rise in the European part of the country.
The Ukrainian flats market saw only minor changes during the course of the 18th week. Although a rising trend in producers' quotations continued in the HR and CR sectors, due to the holidays these price increases did not take full effect.