During the 46th week, the seasonal slowdown enveloped almost all products in both the
CIS export and domestic markets. Although some price rises were seen in the Russian and Ukrainian domestic markets for HR and channel bar, domestic demand in the
longs and
flats sectors continued to be slack. As far as the export markets are concerned, both
longs and
flats continued to show signs of deterioration resulting in price reductions during the 46th week. Meanwhile, the export
scrap market was calm for the week in question.
Scrap: CIS exports shows some signs of weakening
During the 46th week, the Black Sea region
scrap market continued its stable trend regarding
CIS-origin
scrap. Although, Turkish consumers were somewhat active in
scrap purchases during the week in question, they continued to neglect
CIS-origin A3
scrap due to its higher price as compared to the price of
scrap imported from the US and
Europe. The pressure exerted by the Turkish steel mills on
CIS scrap exporters to reduce their prices obtained some results. Thus, bids for
CIS-origin
scrap were heard at around $270/mt CIF Turkish ports last week. However, the volumes offered at this price level were low. With demand for
scrap still high in the Russian and Ukrainian domestic markets, exporters from the
CIS can allow themselves the luxury of abstaining from external sales for a little while longer.
During the week ended November 20, the Russian domestic
scrap market was in a stable condition. The demand for
scrap in the local market is still strong, but some signs of weakening could already be detected due to completion of winter
scrap reserve stockpiling by the steel mills. As for price, the domestic
scrap prices sustained their levels in the course of the week.
A price rising trend returned to the Ukrainian domestic
scrap market during the 46th week. In the course of the week, the
scrap price increased by on average $3/mt in the Ukrainian domestic market. Due to the fact that the building up of winter
scrap reserves in
Ukraine takes place later than in
Russia, this process was still evident in the Ukrainian domestic market during the week, unlike
Russia where it has reached completion. Consequently, the steel producers were raising their procurement
scrap prices to buy the necessary volumes of
scrap. The rising
scrap price trend in the Ukrainian domestic market may continue until the local mills consider their winter
scrap reserves to have reached sufficient levels.
Long Products: seasonal slowdown leaves no choice to producers but to cut prices
The seasonal slowdown in the
Middle East market as well as the beginning of the ’dead season' in the Russian
construction sector left the
CIS long product exporters no choice but to decrease their price offers. During the third week of November,
CIS longs exporters agreed to reduce their prices for external deliveries, with their
billet price seeing a consequent $5/mt decrease.
During the 46th week, the price decrease trend continued in the Russian domestic long products market. In the course of the week,
rebar decreased by on average 1.4 percent, while beam deceased by on average 0.2 percent. The only long product which showed a positive tendency during the week in question was channel bar, the price of which rose by on average two percent in the Russian domestic market. Due to the weakening of the Russian local market, many other
CIS producers had to lower their domestic prices as well. This trend was seen in
Moldova and
Belarus in particular during the week ended November 20.
The
longs market in
Ukraine had an uneventful 46th week with few changes. Some price fluctuations were seen in regard to
rebar, angle, beam and channel bar. These, however, were very insignificant.
Flat rolled: export prices continue to decrease due to weak domestic markets
The
CIS export prices for flat products continued to deteriorate during the 46th week. Almost non-existent demand for flat rolled products, with the exception of
plate, continued to affect the prices of the
CIS producers in the export markets. During the week ended November 20, the major Russian and Ukrainian flat producers entered the market with their new prices for December deliveries. These are lower by on average $5-15/mt for HR than in November last year. In addition, the lowering level of purchases in the US market in regard to
CIS-origin flat rolled may lead to a further decrease in the
CIS export prices.
The Russian domestic market saw a small increase in regard to HR and CR during the 46th week. However, regardless of the slight price rise during the week - by on average 0.4 percent for HR and one percent for CR - the weak demand for flat rolled in
Russia is expected to continue to push domestic prices down. The price of
galvanized steel was stable during the week under discussion.
The Ukrainian domestic flat rolled market saw some minor fluctuations in the 46th week. The CR price decreased by on average 0.2 percent, while HR and
galvanized steel prices saw average increases of 0.1 and 1.3 percent respectively.