Domestic hot-rolled coil (HRC) prices in Turkey have remained relatively stable over the past week. Although demand has been insufficient and a lot of orders have been going to China at much lower prices, Turkish mills prefer to avoid discounts. Some of them believe that China will soon leave the Turkish market as there is a threat of certain logistics issues due to Covid and possible lockdowns. Others are citing the high HRC prices in Europe as one of the factors justifying the current domestic prices in Turkey. “Today there is a dilemma in the market. Either European HRC [prices] have to drop, or the Chinese prices have to increase, which will happen if China delays cargos due to possible logistic issues,” a Turkish producer told SteelOrbis.
Currently, HRC for June deliveries in Turkey is officially offered by the mills at $1,300-1,350/mt ex-works, although levels of $1,250-1,280/mt ex-works are also considered workable for decent tonnages.
The import HRC segment in Turkey is still dominated by ex-China offers, which are very competitive against Turkish domestic prices. According to sources, SS400 HRC offers from China are at around $1,030-1,050/mt CFR, while Q195 grade prices are at $1,000-1,015/mt CFR, both for May shipments. “China keeps on selling and the demand is there since their HRC prices are almost in line with their slab prices and are $200/mt below local Turkish prices. So why not buy?” a trading source told SteelOrbis.
The next closest offers are reportedly coming from Russia. According to sources, MMK has been trying to sell at $1,050/mt CFR, but it seems that indeed there are certain payment and insurance issues. NLMK is said to be offering HRC to Turkey at $1,100/mt CFR, but still buyers consider dealing with Russia is a risky game to play.
As for alternative offers from Asia, all of them are quite high for the Turkish market, mainly as the suppliers have been setting the levels looking at the workable prices in the EU. Vietnam is in the market with $1,160/mt CFR offers for May shipment, while India is offering at $1,250/mt CFR and above, the same as last week.