The situation in the Turkish flat steel market is yet to gain clarity after a rather aggressive price move by one of the re-rollers, as reported earlier. The mentioned supplier announced to the market it would sell hot-rolled sheets (HRS) at $799/mt ex-warehouse, while other sellers were offering much higher levels than this. As a result, the buyers are now asking from suppliers offers close to the most aggressive ones in the market at present. Some of the small traders, re-rollers and pipe-makers have also started to try selling some of their stocks, trying to minimize them and to avoid even bigger losses. However, large stockists and local HRC producers, although providing discounts over the week, are not yet ready to sell at the lowest levels available in the market from the alternative sources. The market is expected to gain clarity next week.
Following the announcement of the local re-roller to sell HRS and other flats by up to $200/mt lower than the market level, both buyers and sellers have been trying to evaluate the new workable prices and the possibilities of avoiding huge discounts. Some of the small traders and re-rollers, according to the market information, have been selling in small parcels at $830-860/mt and some have been offering at $890-900/mt, both on ex-warehouse basis. Large traders have been resisting the aggressive levels and have been standing at $950-975/mt and up to $990-1,000/mt ex-warehouse. “All people now want to get their cash and to reduce the stocks, even though selling at a loss. In this case, the first loss is a best loss, in case the market decreases further,” a source said.
According to sources, domestic hot-rolled coil (HRC) prices from producers are now at $900-950/mt ex-works, but some buyers report $880-890/mt ex-works and even lower levels might be reachable. Last week, the mills were at $950-1,010/mt ex-works, as SteelOrbis reported.
“Aside from low market demand, a lack of exports, and declining HRC prices, there is bitter rivalry in the market right now. One of the stockists lowered prices much below what they should be, and now the range of the HRS prices is too wide. This situation is not getting better and it affects us as well. If the downward trend continues, sales will grind to a standstill since we would be unable to profit from our sales,” a trader said.
Import HRC offers have decreased substantially in Turkey over the past week. According to sources, ex-China offers from traders are at $830-850/mt CFR for Q195 quality, down by $40-70/mt over the past week. Indian mills are at $850-860/mt CFR in the initial offers versus $930/mt CFR indications reported last Friday. Other ex-Asia offers are at higher levels - $900/mt CFR from Taiwan and $930/mt CFR from South Korea.
No solid import offers have been heard from Russia, although the suppliers there are reportedly aggressively seeking to sell, pushing customers to give bids. The demand side seems to be silent as buyers refuse to deal for Russian origin because of risks and since the prices are clearly decreasing in the market. “It is also their current sales performance. Clearly, they are desperate to sell but what if we buy today at a certain level and tomorrow they sell at a price $50/mt lower to my competitor?” an HRC importer told SteelOrbis.