CIS flats producers increase their prices

Following the increases in Erdemir's recent price list, the Turkish flat rolled market has directed its focus towards the CIS producers. Market players are curious about how the red-hot markets will react to the price announcements expected from the Russian and Ukrainian steelmakers in the coming days. In the Turkish hot rolled market, the price of Ukrainian steelmaker Ilyich has reached $590-595/mt CFR Turkey while the price of Bulgarian steelmaker Kremikovtzi has increased to a level of $600/mt CFR. Russian steelmaker Severstal has announced that it is not in a situation to allocate material for export due to its strong domestic market. It is said that bids around $50/mt over Severstal's March price level are being invited to check availability, but without guarantee. Severstal's March production prices for Turkey were at $600/mt CFR for HRC, and at $680/mt CFR for CRC. Following Severstal, it is highly possible that other import sources will announce increases by similar amounts. While the effects of the price increases announced by Erdemir have started to be felt in the market, the general view in the market is that Erdemir may increase its prices further. Meanwhile, an increase of Euro 10-15/mt has been seen since last week in Italy - one of the major flats markets in Europe. On the other hand, import hot rolled coil prices have reached levels of Euro 495-500/mt. The current activity in the local Italian market is expected to result in additional price increases in the coming days. Activity in the flats markets is not expected to put on the brake. The fact that import flows of material to the US - where prices have bottomed out - have not been in sufficient quantities for a very long time has meant that the US market is on the verge of gaining momentum again. Therefore, this situation is likely to have a positive effect on the already-active markets, causing additional increases in prices.