During the 36th week of 2007, both the CIS export and domestic markets were characterized by mixed trends. On the one hand, ex-CIS A3 scrap price offers increased due to the continuous rise in freight rates, while the CIS producers hiked their ex-CIS wire rod and rebar offers for the Middle East. On the other hand, CIS flats exporters are waiting to determine their next move as regards prices. In the Russian domestic market, both scrap price rises and decreases were seen, depending on the region. Meanwhile, the Ukrainian domestic steel producers continued their price race, hiking their procurement prices. As for the CIS domestic longs and flats markets, prices in both the Russian and Ukrainian retail markets followed the course determined by the price announcements of the domestic producers.
Scrap: Both price rises and decreases seen in the Russian domestic market
The level of activities in the Black Sea region scrap market remained low, with almost no deals made on CIS origin A3 grade scrap during the 36th week of 2007. However, market players report that Turkish scrap consumers are intending to make purchases in the 37th week. As for the price, during the week ended September 9, the ex-CIS A3 grade scrap price went up by $5/mt, following the corresponding increase in freight rates.
Confusion was the main characteristic of the Russian domestic scrap market during the week in question. Market players reported both price increasing and price decreasing trends. On the one hand, the domestic steelmakers based in the central and southern Russian regions slightly increased their scrap prices during the week ended September 9 - as a safeguard measure against the predicted reactivation of export deliveries. On the other hand, the mills located in the Ural part of the country lowered their procurement scrap prices. As a result of such diverse fluctuations, the average scrap price in the Russian domestic market changed little.
In the Ukrainian domestic scrap market, the domestic steel mills continued their race for scrap during the 36th week. Although a price as high as UAH 1,315/mt ($263/mt) CPT mill has been heard in the market, deliveries to the domestic steel mills were concluded at UAH 1,200-1,260/mt ($240-252/mt) CPT mill, excluding railway tariffs.
Long products: CIS longs producers hike their export prices
The CIS billet exporters continued to keep their prices at high levels regardless of the almost nonexistent purchases at offered prices during the 36th week. Just as during the previous week, CIS billet exporters have been hoping that activity in the Middle East, Gulf and European markets will strengthen soon.
On the other hand, the CIS longs producers, as anticipated during the 35th week, came to the market with new increased rebar and wire rod prices during the 36th week. Thus, rebar and wire rod FOB ex-Black sea offers for the Middle East increased by $40/mt and $30/mt respectively. Yet it is still not known whether buyers will accept this price rise.
The Russian domestic longs market again became softer during the week ended September 9, after a week's break. Following the announced increase by both Russian domestic and imported material producers, longs retail prices went down as well. Thus, rebar registered a decrease of Ruble 400-500/mt ($16-20/mt) in the Russian retail market, while wire rod prices dropped by Ruble 200/mt ($8/mt).
The Ukrainian domestic longs market was governed by mixed trends during the week in question. On the one hand, rebar showed a UAH 10/mt ($2/mt) decrease in the retail market. On the other hand, structural steel trended up as a result of producers' price increases.
Flats: CIS flats producers yet to determine their prices
During the 36th week, the CIS flats export market stood on hold, awaiting the announcements of new export prices by the Russian and Ukrainian exporters in the 37th week. According to preliminary indications, the exporters are planning on raising their prices. However, it is still doubtful whether or not the market is ready for a price increase.
During the 36th week, the Russian domestic flats market saw a price decreasing trend in the retail market following the price reductions announced by the producers. As a result, in the Russian retail market HR decreased by Ruble 200-900/mt ($8-35/mt) depending on the delivery region, while CR dropped by Ruble 200-300/mt ($8-12/mt) depending also on the delivery region.
Meanwhile, the Ukrainian domestic flats market saw an upward price correction in CR steel. Following the price hike in the price lists of the Ukrainian producers, the CR price increased by UAH 50/mt ($10/mt) in the country's retail market during the 36th week.