During the 48th week (Nov. 26-Dec. 2) of 2007, the CIS export markets showed both high levels of purchase activities and consequently price rises as regards scrap, billet and longs. On the other hand, although CIS flats exporters made an attempt to raise their offers as well, it has not yet met with much success. As for the CIS domestic markets, during the week in question the Russian steel market showed stable trends in respect to all products. On the other hand, slightly decreasing tendencies were registered in the Ukrainian retail markets for rebar and CR, while scrap and HR prices preserved their levels.
Scrap: Black Sea region scrap market shows high levels of activity
During the 48th week, the Black Sea scrap market was characterized by relatively high levels of purchase activities, supported by the low level of consumers' scrap stocks. Turkish producers, who abstained from large purchases for almost the whole of November, are now actively building up their stocks in light of the approaching winter and thereby the expected seasonal decrease in scrap supplies. With regard to prices, the increasing freight rates played an important role in upping the import prices for A3 grade scrap during the week ended December 2. Thus, the price for ex-CIS A3 grade scrap was quoted at the level of $360-365/mt CIF Turkey during the 48th week.
The Russian scrap market was at a relatively low ebb during the 48th week, given the fact that most steel mills have already built their winter stocks and have therefore assumed a wait-and-see policy. Although some price decreasing trends were observed in the procurement scrap prices of individual mills during the week in question, while some continued active purchases, the overall market showed a slowdown trend.
On the other hand, the Ukrainian domestic scrap market saw some stabilization during the 48th week, with no price fluctuations registered in the market.
Longs: Active purchases in Middle East and Gulf support price rise for CIS origin products
The CIS billet exports market saw much activity during the 48th week, which brought about yet another price rise. The main factor responsible for the success of the Russian and Ukrainian billet exporters was the renewal of active purchases in the Middle East and Gulf markets. The return of these markets to active purchases, together with the strength of the South Asian and Iranian markets, contributed to the success of the billet price rise of over $10/mt. In addition, increasing freight rates and raw material costs will further facilitate the price rise of semis.
Following the reactivation of the billet market in the Middle East and Gulf region, the longs markets in these regions also showed strong demand during the 48th week. During the week in question, offers of CIS rebar producers saw a $20-30/mt increase depending on the delivery market.
On the other hand, the Russian domestic longs market, which experienced downward trends over quite a long time have stabilized, as producers announced unchanged prices for December deliveries. Consequently, the month of December is expected to proceed more or less on a stable trend in the longs retail markets.
During the 48th week, the Ukrainian domestic longs market experienced a slightly negative trend as far as the rebar retail market was concerned. However, these negative tendencies bore regional characteristics depending on traders' levels of stock.
Flats: CIS export flats market still on slight slowdown trend
Under pressure from rising raw material prices and freight rates, the CIS flats exporters tried to raise their export prices slightly during the 48th week. However, as the global flats market has experienced a slowdown, with the exception of plates, acceptance of the increased prices cannot be expected before the beginning of the New Year.
The Russian domestic flats market followed a stable trend during the 48th week. Although some positive trends have been seen in the central regions, these were insignificant.
The Ukrainian domestic flats market showed a mixed trend, depending on the different types of flats, during the 48th week. On the one hand, CR dropped slightly, by about UAH 15/mt ($3/mt) in the Ukrainian retail market. On the other hand, the HR price did not change throughout the week in question.