49th week CIS markets review: Can A3 scrap compete with deep sea in the Turkish market?

The 49th week was governed by relative stability regarding the CIS longs and flats export markets. The export prices seemed to stabilize a bit following long continuous decreases in these markets. The CIS market also saw some development in respect to scrap exports. Due to the rise in deep sea scrap prices some bookings were made on A3 scrap in the course of the week. The CIS domestic markets, on the other hand, continued to experience a further drop in flats and longs prices. Scrap: Rise in deep sea prices makes A3 scrap sales possible Following the deep sea scrap price increases made by the US and European exporters during the 48th week, the Black Sea region scrap market saw some activity regarding CIS-origin A3 scrap purchases during the 49th week. Several bookings were reported for ex-Black Sea A3 scrap, which was quoted at approximately the same level as deep sea scrap in the Turkish market. However, the level of scrap offers from the CIS was rather low due to the very active Russian and Ukrainian markets. During the 49th week, the Russian domestic market was governed by a stable trend. Although demand for scrap is very low, as may be expected during this time of the year, the prices of A3 grade scrap in the Russian domestic market were able to preserve their levels. Scrap prices in the Ukrainian domestic market, on the other hand, experienced a slight rise in the course of the week ended December 11, registering an increase of around UAH10/mt ($2). Long products: Negative trend deepens in the domestic markets During the 49th week, the CIS longs export markets continued to show a negative trend, although to a lesser extent than in the 48th week. The Gulf continued to be maybe the only market where the demand for longs was still relatively high. However, the tight competition in the market between importers from different countries caused the price to go down slightly. Thus, during the week ended December 11, Ukrainian longs producers decreased their rebar export prices slightly. In the course of the 49th week, the Russian domestic long products market continued to be governed by a negative trend. A large price drop was seen in rebar - an average of four percent – and also in beam – an average of 1.5 percent. Meanwhile angle and channel prices showed only slight changes during the week. In Ukraine, longs products continued to decrease in price during the 49th week. As in the Russian market, rebar also showed the largest decrease in price in the Ukrainian market - down by UAH 25/mt ($5). In addition, the price of channel bar dropped by on average UAH 20/mt ($4) during the week. Flat rolled: Export prices start to gain a bit During the 49th week, CIS-origin flat rolled showed some signs of stabilization with a slight increase in prices. Thus, during last week HR of Ukrainian-origin was offered at $10/mt higher than during the week before. Meanwhile, flats prices were more or less able to preserve their previous levels. During the week ended December 11, the Russian domestic flat rolled market experienced an increasing trend in both galvanized steel and HR, yet saw a decreasing trend in respect to CR. In the course of the week, the CR price recorded a two percent decrease, while HR and galvanized steel prices showed a 0.7 percent and a two percent increase respectively. The Ukrainian domestic flats market continued its decreasing trend during the 49th week. While the CR price dropped by UAH40/mt ($8), the HR price decreased by UAH5-20/mt ($1-4). However, the largest price reduction was seen in galvanized steel, decreasing by on average UAH100/mt ($20) over the week in question.