Business activity in Turkey’s hot-rolled coil (HRC) market has been slow this week due to the holiday, but still mills’ domestic price indications have decreased and are even expected to decline further as demand has been extremely weak. The market and prices will gain certain clarity next week, sources believe.
Currently, the domestic HRC prices in Turkey are mainly set at $1,100/mt ex-works, $50/mt down from the indications of last week. Some of the producers say $1,050/mt ex-works levels are also possible if there is some solid demand, but at the same time report that buyers’ activity is close to zero nowadays. “We will see more decreases soon and this is not a disaster. This is the market just going back to normal after being inflated for several weeks. With the decreasing scrap, the margins of the mills are still huge,” a trading source told SteelOrbis. The export offers have settled at $1,050-1,080/mt FOB for now, versus $1,150/mt FOB last week. Despite the sizeable discounts, Turkish mills have no chance to sell to Europe, taking into account the most recent deals from South Korea and Japan were closed at €970-975/mt CFR, which equals around $1,030-1,035/mt CFR. Moreover, a €950/mt CFR ($1,005-1,010/mt) CFR sale has been discussed in the market as having been closed to Italy from South Korea.
In the import segment, offers are rare for now. Some sources have reported $950/mt CFR from India, but some traders doubt the suppliers are ready to go that low, at least for now. On the other hand, ex-Russia offers have been heard at $930-950/mt CFR depending on the supplier. “In this market, Russia has to be at least $30/mt lower than the normal origins. The options [to work with Russia] are there, but the risks are high,” source told SteelOrbis.
In the retail flats market, some traders have decided to decrease their offers for hot-rolled sheets (HRS) by $10-50/mt to $1,050-1,140/mt ex-warehouse depending on the supplier. “There were not many sales … this week, however, I believe there will be more demand in the market soon, and it will be more active,” a trader told SteelOrbis.
