Although it is heard that the CIS producers are offering billets for export at $880/mt FOB, in the past seven days the CIS billet offers have in general been at $860-870/mt FOB for late May/early June shipment. CIS billet offers have not registered any significant change this week. The purchase levels in the Middle East and the Southeast Asian markets have seen a slowdown after the bounce observed in recent months. It is observed that the most active markets have recently been the Arabian Peninsula and North Africa. However, market players are not sure if the price trend in these markets will cause the CIS billet prices to go up.
In the same period, Turkish billet prices in the local market have been at $900-930/mt ex-works, excluding VAT, while offers for export have stood at $910-940/mt FOB. It is heard that this week a sale of grade 60 billet was concluded to the Persian Gulf at $990/mt CFR. The Turkish billet producers were not eager to export billets in late February and early March, also since some shortages were experienced in the billet supply at that time. However, the Turkish producers may now be more active in the Turkish billet export market since Turkey's wire rod export market has been not that snappy in recent times.
Different price levels have been seen in Italy this week. An ambiguous billet situation is observed in the local Italian market on account of the fact that long product prices have been increasing rapidly. Producers have reportedly been offering billets for the local market at €590/mt ($932/mt) delivered to rolling mill, excluding VAT. If the Italian market manages to reach the price levels in question and, in addition, to push for levels even higher than these, then the import market, which has been very slow for a long time now, may gain momentum.
The Far East and the Southeast Asian markets, which had caused the Mediterranean and the Black Sea markets to skyrocket in recent weeks, have not been active as regards purchases lately. Regarding long products in particular, China is pressuring the Far East and the Southeast Asian long product prices, as the country is now a net exporter to these regions. Via this pressure, long product prices are not increasing anymore. For this reason, the rolling mills in the regions in question are not warming to the Turkish and CIS billet producers' offers for the time being.
On the other hand, in the SteelOrbis analysis dated March 14, we had mentioned that, if increases continued at a similar rate, then European billet producers could start to export their products. Indeed, it has been heard this week that Riva Group's mill in Germany concluded a billet sale to Morocco at €550/mt ($869/mt) FOB. However, both the upward movement in the overall European market and the increasing €/US$ exchange rate may close the door on similar deals in the future.