During the 37th week (10-16 Sept) of 2007, the CIS export market saw some tensions in semis, longs and flats markets as consumers were reluctant to accept the price increases announced during the 36th and 37th weeks. In the scrap market, the level of activity was still low due to confusion regarding freight rates. On the other hand, the Russian domestic market was characterized by price decreases in flats and longs, and by stability in the scrap market. Meanwhile, the Ukrainian domestic market was more or less stable. The only exception here was the Ukrainian scrap domestic market which trended downward during the 37th week.
Scrap: CIS domestic markets see some signs of stabilization
CIS-origin A3 grade scrap prices maintained their stability during the 37th week in the Black Sea regional scrap market. However, the level of activity was still somewhat low with only limited bookings being heard. Meanwhile, the main characteristics of the market - soaring freight rates and difficulties regarding cargo ship availability - were still acutely present.
The Russian domestic scrap market saw stabilization during the week ended September 16. Although the domestic A3 grade scrap price underwent a leveling process during the 36th week, during the 37th week no price fluctuations were seen in the market.
On the other hand, A3 grade scrap saw a slight upward movement in price in the Ukrainian domestic market during the week ended September 16. However, the price increased by a smaller degree than during the previous week.Long products: Exporters wait for price acceptance
During the 37th week, the CIS billet exporters were fighting to keep their prices stable regardless of the export markets' reluctance to accept offered levels. The soft longs markets in the Middle East and Gulf regions supported the reluctance of ex-CIS billet consumers to accept current price levels.
The price increases announced by the CIS longs exporters during the 36th week have not yet met acceptance from consumers. In the Middle East in particular, the level of buying activity in the market has remained low.
The Russian domestic longs market continued to soften during the week ended September 16. In the course of the week, the rebar price dropped by Ruble 130-300/mt ($5-12/mt) depending on the region offered. However, in general the market condition is seeing some improvements.
In Ukraine, structural steel showed some strength during the 37th week. In the retail market, the price of beam went up by UAH 80/mt ($16/mt) while the angle price climbed by UAH 10/mt ($2/mt). Meanwhile, rebar prices showed no change in the Ukrainian retail market during last week.
Flat rolled: CIS flats exporters hike prices
The price increases for CIS-origin flat products, forecasted by market players during the 36th week, were announced during the 37th week by the Russian flats producers. As a result, both CR and HR offers increased by $25/mt to the Mediterranean. Meanwhile, the European market - the reactivation of which had been awaited with such anticipation by market players - had not occurred. Moreover, the forecasts have even become more negative as exporters report high levels of stocks, stable prices and low levels of activity.
The Russian flats market saw a slight decrease in the 37th week. In the retail market, the HR price dropped by an average of Ruble 300/mt ($12/mt) while CR decreased by Ruble 80/mt ($7/mt).
On the other hand, some positive trends were seen in the Ukrainian domestic market. The reduced quantities of imported materials (due to increased freight rates) and the rising import prices positively affected the market demand in Ukraine which started to move toward equilibrium - the first sign of which was the stabilization of market prices during the 37th week.