Contrary to expectations, no uptrend has been seen in rebar demand in the local Turkish market after the religious holiday; instead, the market has registered a downtrend in line with the weakening of the US dollar. During the current week, different price levels have been observed depending on thickness in the various regions in Turkey, with prices in a range of TRY 800-860/mt including VAT ($458-492/mt excluding VAT). After a producer in Turkey announced the price level of TRY 728.81/mt ($492/mt) ex-works excluding VAT in the Marmara region for thick specifications on Thursday, December 3, Kardemir AS has today, December 4, announced the price level of TRY 721/mt ($486/mt) ex-works, excluding VAT. While limited tonnages have been sold at all these prices, local traders seem cautious since the expected demand from the end-user side has not materialized for the time being.
In the current week in the Middle East, where the holidays have been continuing in some regions, the Dubai announcement regarding debt payment delay has attracted a good deal of attention. Due to the holidays, the announcement in question has not yet exerted its full impact on the local market. Following the sales concluded by Turkish producers to this region before the holidays, no improvement has been observed in the market, and the local prices have showed no change compared to the previous week.
In Libya, which for now has become an important market for the Turkish steelmakers, Turkish constructors' account receivable problems have been resolved after visits of members of the Turkish government. This week rebar demand from this country is observed to have increased. Turkish rebar offers to this country have in general been at $500/mt CFR, though some producers are giving offers at lower levels.
Demand from Egypt to Turkey has this week increased slightly since the local Egyptian rebar producers announced price hikes during the week, i.e, Egyptian mill EZDK has increased its domestic rebar prices by EGP 150/mt ($27/mt) to EGP 2,950/mt ($539/mt) ex-works, whereas Beshay Steel has increased its domestic rebar price to EGP 2,870/mt ($524/mt) ex-works. However, a lot of Turkish rebar producers have experienced difficulties in responding positively to the demand from this country since Egyptian buyers' desired prices are at far lower numbers compared to the Turkish rebar prices. On the other hand, some other Turkish rebar producers have tried to modify their prices in line with the Egyptian inquiries.
Also in Turkey, scrap offer levels have this week been at even higher levels compared to the situation before the holidays, while no new scrap purchase activity has been observed in the country during the current week. In addition, the possible impact of the rising raw material prices on finished steel products has in general caused concern. It will become clearer in the coming week to what extent the Turkish rebar producers (who have been experiencing difficulties due to low demand) will reflect the rising raw material costs in their finished steel prices.
On the southern Europe side, producers have continued to raise their prices on the back of raw material costs, whereas buyers are hesitating to purchase at the increased steel prices. In this context, there has been sales activity at lower levels than the asked prices.
While buyers' desired price levels in the Spanish market are at €380-390/mt ($574-589/mt) delivered to customer, it is heard that some producers are even offering at around €370/mt ($559/mt) delivered to customer. Although the Spanish mills are offering rebar at €340-350/mt ($514-529/mt) FOB on the export side, it is heard that they are also offering at lower prices to certain regions. However, no price change in rebars has this week been observed in the local market of Spain's neighbor, Portugal. Considering that most Spanish mills will start maintenance work during the holidays, it is expected that production activity in the country will come to a halt for a while at the end of this month.
Meanwhile, a new rebar price uptrend has been observed in Italy due to rising scrap costs. While base prices have increased to €140-150/mt ($211-226/mt) ex-works, there is still not enough ready material in the market. With a lot of Italian rebar producers due to suspend their production late this month, they are hesitating to give rebar offers to the export markets.
Turning to Greece, local list prices for medium size rebar in the Greek domestic market have been at stable levels of €400-420/mt ($604-634/mt) delivered to customer, excluding VAT, on actual weight basis, though lower prices have been heard depending on tonnage. While demand is weak on the local side, nowadays no great activity is observed on the export side either.
In the UK, low demand has resulted in a variety of prices. In the UK domestic rebar market, local mills' prices of medium sized rebar are standing at the level of £300-310/mt ($498-514/mt) delivered to customer on actual weight basis for 30-day deferred payment in general. Price levels show variation depending on destination (i.e., lower prices for closer locations). Also, it is observed that some imported rebars are still being offered to the local market at very competitive prices.
Looking at Germany, it seems that the German rebar producers are still increasing their prices ahead of the end-of-year holidays. Although the local mills' offers of medium sized rebar have increased for January shipment to €350-360/mt ($528-543/mt) delivered to customer, excluding VAT, on actual weight basis, no sales have been heard at these prices yet. On the other hand, rebar offers given to Germany from mills in Poland have this week been at €330/mt ($498/mt) DDP (delivered duty paid) on actual weight basis. It is remarked that steel trade activity in Germany is still being carried out on truck basis. Rebar prices in this country are also currently influenced more by raw materials than by demand.
In general, summing up, rebar price increase attempts based on raw materials have this week reigned in the European markets as the end-of-year holidays approach; however, some rebar producers do not wish to mention any new price levels for the New Year due to the current uncertainty in the market.