How will the strength of Russian domestic longs market affect billet prices in Med-Black Sea?

CIS-origin billet prices are continuing to increase due to the strong demand. It is heard that bookings were concluded at $510/mt FOB Black Sea and above at the beginning of last week and at $520/mt FOB Black Sea and above towards the end of last week. This week, offer levels are at $530-540/mt FOB Black Sea. It is also heard that bookings have been concluded at above $530/mt FOB Black Sea. Currently, the most appealing markets for CIS billet, especially for Ukrainian production, seem to be eastern and southern Europe and some North African markets. Russian mills are reducing their billet export tonnages due to the gradually increasing domestic long products market. Turkish-origin billet became active with the sales bookings of Turkish mills Isdemir and Kardemir, respectively at $540/mt and $535/mt. Both producers' sales are currently closed. The billets sold by Isdemir last week are expected to be delivered in May. This week, the producers in Izmir and Marmara are making offers at $560-570/mt delivered to warehouse. Rolling mills have not expressed interest in the offers from the Black Sea at $550-560/mt CFR to Turkish ports. Besides, the rolling mills in Turkey have not shown interest in import billet offers since February. Although Chinese offers are at $480/mt FOB and slightly above, they lack appeal since they are not below $550/mt CFR Turkish ports. Turkish mills are pushing for export levels of $570/mt FOB Turkish ports. However, they are not aggressive for exports due to the rallying trend observed in wire rod and the strong billet demand in the domestic market. The supply of Russian billet for export is expected to decrease due to the strength experienced in the country's long products market. The increase in European long product prices also provides support for billet. Italian domestic billet prices at €450/mt make this market particularly attractive for Ukrainian billet. Furthermore, the increase in both European and US-origin scrap prices appears to be having a positive effect. On the other hand, all current developments are not so positive. The rapid billet increase in the Mediterranean and Black Sea encourages customers in the Persian Gulf to purchase billet from China, India and Malaysia, with offers from these countries to the Persian Gulf at $530/mt CFR for May shipment. In addition, the export tax imposed by the Egyptian government has caused domestic long product prices to fall. This situation means that customers in Egypt are having difficulty in paying Ukrainian billet offer levels for the country.