International rebar prices have been continuing their declining movement, just like scrap and semi-finished prices. During August, rebar prices in Europe have been characterized by lack of certainty due to the holidays. Both local and export price levels in this market have not been met with acceptance by traders and end-users due to the ever-changing price levels. The downward trend in the global rebar market and the expectation of further price declines have played a great role in this situation. Coming to the end of the current week, the European traders and producers, who expect an improvement in the end-user demand, may be surprised with the declining local price levels in their target export markets: Greece, Bulgaria and Romania. The stock levels of the traders in these three countries are at higher levels compared to traders' stock levels in Italy and Spain. For this reason, possible rebar deals from Italy and Spain to these markets may provide relief for the local markets in Italy and Spain; however, such prospective deals may cause local prices in Romania, Greece and Bulgaria to decline due to possible over-supply in these markets.
The local rebar prices in Turkey are maintaining their downward trend. End-users in this market are expecting further price declines each day since the local producers have been announcing low price levels and also because it is possible to find lower priced levels for finished steel products from traders compared to the announced ones. However, only the demand level situation as well as the issue of export stability can give an indication of when the declines in the local rebar market (where fixing a definite price level is proving difficult) will come to an end. Although it is observed that the local rebar price level in Turkey has this week been at TRY 1,180-1,300/mt ($998-1,099) ex-works including VAT, no deals concluded at TRY1,300/mt have been heard.
In the Turkish rebar export market, Turkish rebar producers have continued to export to the regions to which they exported with large tonnages in the first half of 2008, but with tonnages at low levels for the past month and a half. The rebar export market price levels of the Turkish producers have this week been at $920-1,000/mt FOB Turkey. It is heard that there have been several deals concluded at these price levels. Saudi Arabia, the United Kingdom and Lebanon are some of the destinations in question. It is known that the Turkish producers have been ineffectual in exports to Dubai for six weeks now. However, it is reported that there is demand coming from Dubai to Turkish producers for Turkish material. If this results in business, it is expected that the deal price levels of CARES certification rebars from Turkey to Dubai will be at the range of $1,100-1,200/mt CFR Dubai. However, the Turkish producers do not want to damage the balance of the market with low-priced offers given that the large tonnage deals concluded to Dubai for September shipments have not arrived in Dubai yet, and also since the local rebar price levels in Dubai have decreased to AED 4,800/mt ($1,307/mt) delivered to site.
As CIS rebar export offers are at $950-960/mt FOB for October shipments, it is surprising that these offers are at higher levels compared to the Turkish offers' minimum price level. Since early 2008, the CIS rebar offers had consistently been almost $100/mt lower than levels in the Turkish rebar market. It may be said that the fairly low price levels in the Turkish domestic rebar market are the main factor behind this change of situation.
It is rumored that there may be a downward price adjustment in the European and Turkish producers' rebar prices for their local markets. The aim of such a price reduction would be to help prices find a real level based on end-user demand, counteracting the continuously decreasing prices and getting end-users to start their purchases.