As expected, the recent developments in China due to temporary limitation of production and the related rise in futures prices have resulted in even higher HRC import offers in the Turkish market as of July 3. Local and export prices in Turkey have remained stable so far, but some market players expect that the mills might take advantage and pull up their official offers.
Currently, 3 mm and up Q195 HRC from China for mid-August shipments is offered at $490/mt CFR from major trading companies, while the non-VAT offers are evaluated at around $475-480/mt CFR, SteelOrbis has learned. A day earlier, the general range stood at $465-480/mt CFR, while a week ago the level was at $460-470/mt CFR depending on the day. The latest deal from China was closed at $458-459/mt CFR to Turkey to a Marmara region-based re-rolling company.
The latest import price from China is not expected to see much interest among Turkish buyers since the offer is not sufficiently distant from domestic prices of $540-550/mt ex-works. Another issue is that Chinese material is for end-of-September and early October deliveries, and so Turkish importers might continue buying from nearby sources with shorter lead times and less risks. Particularly, Russia is expected to start offering for August shipments next week, while Egypt is now at $540/mt CFR for August shipments.
Some of the market sources expect Turkish mills to attempt increasing their official HRC offers by around $5-10/mt in both local and export markets, using the current price policy from China. In fact, according to some players, a couple of mills have withdrawn their export offers, while earlier $510-525/mt FOB levels were considered realistic and down to $500-505/mt FOB in workable levels for special orders. Locally, a similar situation might be seen, although it is largely believed that demand is not strong enough to provide the needed support for higher prices, SteelOrbis understands.