During the 20th week of 2008 (May 12-18), both CIS scrap and flats export markets were dominated by upward trends in prices for ex-CIS materials. Meanwhile, although no visible rise had been registered in the longs section of the export market, tensions between suppliers and consumers continued.
As for the CIS domestic markets, the scrap markets in both Russia and Ukraine, although remaining stable, seemed to fulfill the preconditions for a rise in the near future. On the other hand, the prices of finished steel products in both countries continued to move up.
Scrap: CIS domestic market prepares for further rise
During the 20th week, the Black Sea region scrap market was characterized by rising quotations for CIS-origin scrap. Due to limited offers and increased prices for semi-finished and finished steel products, A3 grade scrap offers rose slightly during the week in question.
Although the Russian and Ukrainian domestic scrap markets remained stable during the week under discussion, the signals indicating the imminence of an increase in the procurement prices of domestic steel mills started to grow stronger. Thus, in the Russian market, several steel mills upped their procurement prices during last week, while in Ukraine an increase is expected toward the end of the month, when domestic mills will have used up their current scrap stocks.
Longs: CIS domestic market continues to record new price highs
During the week ended May 18, the CIS billet and longs export market was relatively calm, with buyers trying to resist the new price rise announced by CIS billet exporters during the previous week. However, it seems that buyers from the Middle East and Gulf have slowly started to accept the new prices due to the tightness in their markets. Meanwhile, the Southeast Asian market, which had recently been booming, calmed down during the week in question as buyers there have almost completed building up their stocks.
During the week ended May 18, the longs markets in both Russia and Ukraine continued to post upward trends. Whereas during the first half of May a relative slowdown in the price rising trend had been seen in the Ukrainian domestic market, during the 20th week the market price of rebar went up again by about UAH 80/mt ($16/mt). Meanwhile, the rebar price in the Russian retail market increased by about Ruble 1,000/mt ($42/mt).
Flats: Both domestic and export markets are on the rise
The CIS flats export market continued to show an upward trend during the week ended May 18. Against the background of rising domestic scrap prices and favorable international market conditions, several CIS producers came to the market with an increase of about $50-60/mt, depending on the producer, for the new contracts.
The Russian and Ukrainian domestic flats markets continued to rise in unison during the 20th week. Thus, CR and HR increased by UAH 150/mt ($30/mt) and UAH 110/mt ($22/mt) respectively in the Ukrainian domestic market. Meanwhile, CR and HR saw respective increases of Ruble 300/mt ($13/mt) and Ruble 400/mt ($17/mt) in the Russian domestic market.