Demand in the local Turkish hot rolled coil (HRC) spot market is still on the strong side, while HRC prices have remained unchanged over the past week. Traders in the market state that profit margins have narrowed significantly due to Turkish producers' increasing prices and that an upward price revision is vital in the short run. However, traders also indicate that the main obstacle to a price increase is the possibility of resistance from the market.
Meanwhile, demand for Turkish producers' HRC has softened a little over the past week and is now at medium levels. Some producers have increased their HRC prices by $5/mt for November production, causing the overall price level to increase by $5/mt on the upper end to $590-605/mt ex-works. However, China is currently targeting the export markets due to the weak demand in its local markets. Chinese offers are now more plentiful in the local Turkish market, with their competitiveness boosted by the ongoing downtrend of prices of iron ore - the raw material used by most Chinese producers. In this overall context, Turkish buyers are currently reluctant to resume their HRC purchases.
The domestic sales prices of traders for local and imported hot rolled flat steel products in the Eregli and Gebze regions of Turkey are as follows:
Product | Price ($/mt) | |
Eregli | Gebze | |
2-12 mm HRC | 610-620 | 615-625 |
2-12 mm HRC (for large volume sales) | 600-610 | |
1.5 mm HRS | 640-650 | 645-655 |
3-12 mm HR P&O | 650-660 | 660-670 |
The above prices are ex-warehouse and for advance payments, exclusive of 18 percent VAT.
