During the 21st week of 2007, CIS steel exports followed mixed trends depending on the various product groups. Whereas a decreasing trend continued in the scrap markets (both in the export and domestic markets) and in the semis and flats export markets, the CIS structural steel export market showed some signs of a rise. The Russian domestic longs market continued its climb during the week ended May 27, though at a slower pace. Meanwhile, the price-demand imbalance in both the Ukrainian flats and longs markets had some consequences, i.e. helping to push prices down.
Scrap: Prices keep on falling
During the 21st week of this year, the Black Sea region scrap market continued its calm trend of the previous week. The Turkish consumers were still keeping away from active purchases, buying scrap only in small lots. This policy, however, brought some results with A3 grade scrap decreasing to an average level of $315/mt CIF Turkish ports during the week in question. Yet, market experts predict no further decrease in scrap prices, since the markets for finished steel products have started to revive slowly.
The Russian domestic scrap market continued its decreasing trend during the week ended May 27, mostly due to the excess of scrap offers in the market and the calm atmosphere in the export markets. Several steelworks in the Russian domestic market decreased their procurement scrap prices by Ruble 200-500/mt ($8-19/mt), while the average price was established at a level of Ruble 5,950-7,100/mt ($230-274/mt).
The Ukrainian domestic scrap market also saw further price decrease during the 21st week of the year. Due to the increase in domestic scrap supplies (some steelworks have more than 100 percent scrap stocks), the main domestic consumers decreased their prices by UAH 50/mt ($10) to UAH 1,100-1,130/mt ($220-226/mt) late last week.
Long products: Mixed trends seen in CIS longs export markets
During the week ended May 27, CIS-origin billets decreased a further $10/mt in the Middle East and in the European market against a background of very low sales. The current situation in the market is like a game of "who blinks first" between suppliers and consumers as they both attempt to hold out for their demands.
The CIS longs market continued its price fall in the 21st week, with the prices for Ukrainian rebar and wire rod decreasing by on average $5-10/mt. On the other hand, prices for CIS-origin structural steel have seen some increases. During the week in question, export offers of Russian and Ukrainian structural steel increased by $15-20/mt.
The Russian domestic market saw some slowdown in the week ended May 27. Although the price increase did not stop completely, the upward fluctuations were minor. Yet, since the domestic traders did not fully implement the producers' price increase in the retail market, a new rise is expected to be seen in the market in the upcoming weeks.
The moderate demand for long products finally started to have a slowing effect on the continuous price rise in the Ukrainian domestic market during the 21st week. Although the price increased slightly (rebar and beam prices rose in the Ukrainian retail market by an average of $5/mt), it seems that the artificial price rise will come to an end soon.
Flat Rolled: Decrease in exports begins to affect domestic prices
The negative corrections continued in the CIS flats market during the week ended May 27. Although many market players predicted a wave of price increases at the end of May and beginning of June, it seems that these forecasts will not be realized or will at least be postponed. During the week in question CIS-origin HR decreased by $20/mt while CR decreased even further by an average of $30/mt.
The Russian domestic market was governed by a stable, calm trend during the 21st week, with no price corrections seen in the market. However, the market is expected to renew its activity during the coming weeks as producers announce their prices for June.
The imbalance between demand and prices in the Ukrainian domestic flats market finally showed its consequences during the 21st week with the price decrease in the retail market regardless of the high prices of the producers. Thus, during the week in question HR decreased by UAH 40/mt ($8/mt) while CR dropped by UAH 10/mt ($2/mt).