Producer prices for 8-12 mm
rebar were in a range of TRY 920-955/mt, including 18 percent VAT, at the beginning of this week. Kardemir closed its debar sales on February 19. It is not possible to say that there was a market revival at the beginning of the week. Although the domestic market has started to show greater signs of activity as the week advanced, prices have almost remained unchanged. However, due to the increase in prices of
rebar exports and
scrap, the domestic market has experienced a positive movement, despite the low US Dollar exchange rate. Producers in Payas are trying to set a minimum price of TRY 960/mt, including VAT. Prices are expected to be at TRY 950/mt in Izmir as of February 26. If the producers in Marmara meet expectations, the forecasted movement in the market can start from late February/early March.
At the beginning of the week,
rebar export offers from the Turkish mills were at $590/mt FOB on actual weight basis for April/May shipments. The bookings and offers of some producers in the south of
Turkey were lower. The price level of concluded sales from southern
Turkey to
Israel and
Russia were reported at $575-580/mt FOB at the beginning of the week. Up to mid-week, sales were heard to
Europe at close to $600/mt FOB. Furthermore, a sale was concluded to the US at $605/mt CFR on a theoretical weight basis at the beginning of the week. In addition, there were rumors in the market of the near completion of the sale of a cargo to the US at $610-615/mt CFR on a theoretical weight basis.
Producers in the
UAE have raised their prices for big quantities, now at AED 2,250/mt ($613/mt) ex-works on a theoretical weight basis, excluding VAT. The price levels of traders for
construction firms are at AED 2,350-2,370/mt delivered to site on a theoretical weight basis for 3- and 5-month deferred payment, excluding VAT. Taking into consideration that recent bookings of big importers are at $590/mt CFR on a theoretical weight basis and offers to comparatively small producers are at $600/mt CFR, both domestic producers and traders will likely increase their sales prices to contractors.
Egyptian origin
rebar have also recorded a rise, following the general trend. The
rebar offers of Egyptian mills for export were at $580-590/mt FOB on actual weight basis at the beginning of the week. The fact that
Russia has started to make purchases, the conclusion of Turkish bookings at $580/mt FOB and the possibility that Turkish mills may increase their prices to $585-590/mt FOB levels in the Russian market, have contributed to raising the Egyptian mills' chances of concluding sales to this market. In addition, the accession of Balkan countries such as
Romania and
Bulgaria to the European Union has limited rebars from
Ukraine due to the issue of quotas. This situation gives an advantage to the Turkish and Egyptian mills.
After the sharp increase of €50/mt recorded in
Italy last week, another southern European country,
Spain, also had its turn in the spotlight. Prices had increased in
Spain two weeks ago, but were limited to rises of €5-10/mt. At the beginning of this week, producers increased their base prices to €360-370/mt. Furthermore, the mills announced on February 20, 2007 that they will also raise size extras by €50/mt as of March 1. The prices in
Spain will have thus recorded a total rise of €70/mt within two weeks when the increase in size extras comes into effect. The price level of AENOR-certificated 12 mm
rebar in the local Spanish market is at around Euro 540-545/mt delivered to warehouse, excluding VAT. A two to three percent discount is being applied for early payment (within 30 days).
Italian
rebar prices have remained unchanged this week. Producers' prices for delivery to customers' premises were at Euro 490-495/mt in the north of the country. The market seems to be trying to absorb the increase experienced last week. However, the increases in
Spain, the continuous rise in offers from
Turkey and the €30/mt rise expected in
Greece next week, in addition to
Italy's significant export market with Algeria, may all contribute to a slight rise in Italian prices.
Rebar prices are continuing to increase in the Mediterranean and
Middle East. The markets are strong in
Europe and the
Middle East, the US has just started purchasing activities and
Russia is slowly becoming active. In addition, the lack of supply and demand in
scrap is causing prices to rise. All these conditions provide support for the market at the current juncture and indicate that prices may continue to increase for a while. However, it is very difficult to determine long-term expectations in such a market that is known to record rapid and drastic changes.