Turkish domestic
rebar market indicated a keen rise this week.
Rebar price rose to $550/mt ex-works at the beginning of the week and then reached around $560/mt through the middle. Demand in the domestic market is considerably strong and there are difficulties in finding goods. Despite the strong demand, large
trading companies are worried about the domestic prices, which are $30 higher than the export prices; therefore they hesitate to build large stocks at these levels.
Turkish producers are not so eager for exports this week due to the high domestic prices for
rebar and
wire rod. Some producers at the beginning of the week do not prefer to give offers especially to the US because of the anti dumping threat. This week, some producers offered
rebar at around $530/mt; but there were also offers above these levels given by some producers. There were sales concluded at $530-535/mt CFR to the
UAE on theoretical weight basis last week. Sales were heard above these levels at the beginning of this week.
Wire rod offers were at $510/mt FOB Turkish ports at the end of last week; however, with the pick up in domestic market, the export offer levels of
wire rod rose to around $520/mt FOB, the required level, Turkish ports this week as in
rebar.
CIS origin
wire rod prices increased to $470-480/mt FOB last week. These levels also preserved their position in the market this week. However, the counter offers from
India and
Pakistan are considerably lower. The market is very weak especially in
India due to the monsoon season. It is also heard that producers are even planning to cut their prices further in the coming days. Actually, this region couldn't give positive input to the price increases in the world for a long time. Therefore, the
trading companies doing business to this region are seeking different markets.
CIS origin, especially Ukrainian
rebar is offered at $440-450/mt FOB Black Sea ports. These levels indicated a $15-20/mt increase compared to two weeks ago. Ukrainian producers had advantage in especially Algerian market with the increase in Euro/US Dollar exchange rate. In addition, Italian producers were offering at $405-410/mt FOB Italian ports in the previous weeks since they considered the domestic market would become weak due to the holidays in August. Italian producers may also pick up their offers for Algeria; with the increase in Ukrainian
rebar prices.
The increase in
scrap and
billet prices contributed to the rise in export prices of
CIS origin material. Furthermore, the strong market conditions in the target markets might help this increase. Chinese producers increased their export prices last week due to the expectation of the Chinese government's cutback of the value-added tax refund. However, it is very interesting that this increase coincided with the surge in Chinese origin material.
European domestic market seems rather flat compared to the other markets.
Wire rod prices are heard that at €410/mt in
Italy, €420/mt in
Spain and €20/mt higher than these levels in
Germany. There is a hesitation for imported
rebar and
wire rod for August shipment. However, if the producers consider that the market will pass the summer like that, they can return to the market for August shipments.
Overall,
CIS, Turkish and Middle Eastern markets continued their strong movement, while European market is flat. There are indications that the Southern Asia is slowing, but this situation seems not to impact the other markets that much, as this region didn't react to the price increases since the beginning of the year.
Market players expect this situation to continue through summer. However, Chinese producers and exporters made aggressive exports at the beginning of May in an effort to take advantage from the possible cutback of the value-added tax refund. The majority of these cargoes will arrive to
Europe-
Middle East in July. It is too early to register the affect of the lower-priced cargoes to the markets.