In the first half of August, Turkish mills have been rather active in their HRC export sales, mainly to Europe and North Africa, with a total tonnage of 100,000-150,000 mt sold depending on market players’ estimates. This development has taken some pressure off Turkish mills, which are offering mainly for October shipment now. However, local business activity remains quiet mainly due to persisting financial issues, and some mills continue voicing high official prices, based on their earlier export performance, climbing scrap prices and non-aggressive import offerings. “The buyers either can’t get loans or can’t get enough loans from the banks and the cash flow problem is huge. Therefore, they cannot get their debts paid to the mills and their current purchase volumes decline,” another source told SteelOrbis.
According to sources, one Turkish mill traded 36,000 mt of HRC to the northern part of the EU at $630/mt CFR without AD tax, which is calculated by some sources as $610-615/mt FOB including some extras with freight estimated at up to $20/mt. Others believe the actual base price is considerably lower than $600/mt FOB given some extras for S355JR grade. A couple of 20,000-25,000 mt deals have been reported as done to Italy and Spain earlier in August at around $610-615/mt FOB base.
In addition, Egypt booked around 40,000 mt of HRC in the past two weeks from three Turkish mills, mainly at $620/mt FOB, though a deal price level at below $610/mt FOB was also reported. A 15,000 mt HRC cargo was also traded to Libya last week at around $650-665/mt FOB effective price, SteelOrbis has learned.
Currently, Turkish mills are aiming to export HRC for October shipment at $630-645/mt FOB mainly, depending on the supplier and the sales destination.
Most local offers are reported at $660-680/mt ex-works and even up to $700/mt ex-works and above. “There is no buyer, so it does not matter what mills say today. Sure, there is the level below which they would not want to go and I believe it is $640-650/mt ex-works at the moment,” a large trader said. “If import offers were more numerous and more aggressive, the workable local prices would be even lower,” he added.
In the import segment, the difference in HRC offers from China and for other origins is too large. Moreover, even the offers from Chinese suppliers, though decreasing this week officially by $10-15/mt to around $585-600/mt CFR, are still not workable in Turkey. Some traders agree that $580-585/mt CFR are the levels possible to obtain from the sellers, but there is no taker in Turkey at this price. “There is no chance at all for that price, rare price ideas [from customers] are at $550-555/mt CFR,” a trader told SteelOrbis.
Other than China, there are offers from Egypt still at $660-665/mt CFR and from South Korea at $670-675/mt CFR. India is barely present in the Turkish market due to the active domestic trade, while the indicative level is estimated at $675/mt CFR, which is definitely not workable in Turkey.
There has been also talk about ex-Russia HRC offers at around $560-565/mt FOB or close to $590/mt CFR Turkey. The level is not considered workable at the moment, even for the non-sanctioned material. In the meantime, slab offers from the relatively non-toxic suppliers have been reported at $510-525/mt CFR, which is also not quite acceptable to buyers.