During the 16th week of 2008 (April 14-20), the CIS export markets were on the rise in all product groups. However, while buyers of CIS-origin flats were more or less in agreement with the new price rises, consumers of billets, longs, and scrap from the CIS seemed to be reluctant to accept the new price hikes.
Meanwhile, both Russian and Ukrainian domestic markets for finished steel continued to reach new highs as regards prices during the week ended April 20.
Scrap: Domestic markets are relatively stable
During the 16th week of 2008, the Black Sea scrap market was characterized by a continuation of its price rising trend. Under the impact of increasing prices for finished steel products and also due to the fear of a possible limitation of the scrap supply from the Black Sea region, A3 grade scrap saw an increase of $5-10/mt during the week in question.
The Russian domestic market started to move slowly toward stabilization in its scrap segment during the week ended April 20. Although some price rising tendencies have been seen in the market, the rise bore regional characteristics.
In Ukraine, on the other hand, the domestic scrap market slowly started to show an upward trend as regards prices. Although during the week ended April 20 the price rise was minimal, more increases are set to be seen in the coming weeks.
Longs: CIS export prices targeting new levels
During the 16th week, the CIS export markets for billets and long products saw another price rise for CIS origin products. Thus, in the week in question alone ex-CIS billet increased in price by $10-15/mt, while offers for rebar and wire rods were moving steadily toward the level of $1,000/mt thanks to strong demand from the European and Middle Eastern markets. Yet it is unlikely that buyers will accept the new price increases without a fight.
The Russian domestic longs market continued to generate new price rises during the week ended April 20. In the retail market the rebar price increased by Ruble 500/mt ($21/mt) and wire rod went up by Ruble 700/mt ($30/mt).
In the Ukrainian domestic longs market the price rise assumed a slower mode during the week ended April 20. Thus, the retail price of rebar in the Ukrainian market saw an increase of UAH 60/mt ($12/mt).
Flats: Russian domestic market is preparing for May increase
Russian and Ukrainian origin flat products continue to rise in price in the export markets. In particular, this trend is seen in the Turkish and Middle Eastern markets, where the prices for CIS origin flats have long ago crossed the mark of $1,000/mt and now are targeting new levels. Meanwhile, strengthening demand in the European market seems likely to attract more and more CIS origin flats.
The Russian domestic flats market reached new record prices during the 16th week. The retail market prices for HR and CR increased by Ruble 1,500/mt ($64/mt) each. It seems as if domestic traders are trying to prepare the market for the announced May increases of the producers, which will provide another boost for the market.
The Ukrainian domestic flats market did not lag behind the Russian domestic flats market as far as price rises were concerned during the week in question. In the retail market the price for HR increased by UAH 150/mt ($30/mt) while the price for CR went up by UAH 200/mt ($80/mt).