During the 18th and 19th weeks of 2008 (April 28-May 11), the CIS export markets were characterized by relatively low levels of activity due to the May holidays. Nevertheless, a price rise for some export products, such as scrap and billets, was registered in the period in question, while price rises for others, such as longs and flats, are expected to be announced very soon.
As for the domestic markets, during the period in question finished steel products continued to rise in price in both Russia and Ukraine.
Scrap: Domestic markets take a break from price races
During the 18th and 19th weeks, the Black Sea region scrap market was characterized by relatively low levels of activity against the background of the continuous price rise in A3 grade scrap. Due to the May holidays, which lasted almost two weeks, not much business activity was seen. On the other hand, the materials which were offered during the weeks in question went up to levels higher than $700/mt CIF Turkey.
The Russian and Ukrainian domestic scrap markets saw stability during the two weeks in question, largely due to the holiday period and also because most of the domestic steelmakers had filled up their stocks by the end of April. However, the stability in the scrap price in both Ukraine and Russia seems to be of a temporary nature. As demand for this raw material continues to rise from both international and domestic steel producers, it won't be long before the prices in the Russian and Ukrainian domestic markets start to rise again.
Longs: New export prices announced for semis, longs are next
Following the May holiday celebrations, CIS exporters entered the market with new, increased prices for billet during the 19th week. The prices for new contracts increased on average by $50/mt, depending on the supply region. The largest increase has been seen for material to be shipped to Asia and Iran, where the CIF price may reach as high as $1,100/mt.
Although CIS exporters of longs did not increase their price offers during the 18th-19th week period, it is expected that the exporters will revise their prices following the acceptance of new billet prices in the markets.
During the weeks in question, both the Ukrainian and Russian domestic longs markets saw price increases regardless of the relatively slow activities in the market due to the May holidays. Thus, compared to the end of April, rebar in the Russian domestic market went up by Ruble 1,100/mt ($46/mt) while the same product in the Ukrainian domestic market increased by UAH 80/mt ($16/mt).
Flats: Strong flats export market awaits CIS producers' new offers
The CIS export markets for flats were characterized by relatively strong demand during the 18th and 19th weeks with expectations that the CIS producers will increase their price offers following the holidays at the end of May.
Both the Russian and Ukrainian domestic markets saw a continuation of the price rises in the flats markets during the two weeks ended May 11. In Russia, CR saw a sharp increase of Ruble 2,000/mt ($84/mt) in retail prices under the pressure of the price rise performed by domestic producers for May. HR and galvanized steel in the Russian domestic market also rose in price, but their rate of increase was smaller than that for CR. Meanwhile in Ukraine the price rises for flat products consisted of UAH 80/mt ($16/mt) for CR, UAH 30/mt ($6/mt) for HR and UAH 130/mt ($26/mt) for galvanized steel.