The Chinese price surge resulting from the resumed talk of production cuts and related futures upturn has naturally pushed up prices for HRC in Turkey since the price for this origin is one of the key benchmarks in this market. Based on the increased offers from China, Turkish mills have also raised their local offers and export indications as well. Moreover, Turkish mills intend to maintain high levels and are hinting at further price increases next week, although demand is not quite supportive. Some local restocking has been done but most of the large buyers refrain from active talks for now, aiming to see a clearer market picture. As for exports, European destinations are quite due to the vacation period, but also Turkish mills are not in a rush to push their sales for September shipments, at least during the next 10-15 days.
The latest import 3mm and up Q195 HRC offers from China for September shipments have been set at $495-505/mt CFR and slightly above depending on the seller, up from $475-483/mt CFR seen a week earlier. There are no takers at these price levels for now, given the long lead time and risks connected to the instability of the price trend. “Nothing at $500/mt CFR and above [from China] is going to work unless local prices settle at $560-570/mt ex-works minimum, and that is not quite seen just yet,” a source told SteelOrbis.
Instead, around 6,000 mt of HRC for September shipments have been booked from Egypt at $540/mt CFR while the initial offers stood at $540-545/mt CFR. More transactions are expected for this origin in the near future.
Russian mills have also attempted to increase their offer levels to Turkey by around $20-25/mt compared to the previous round and are now at $480/mt CFR for the sanctioned material and $500-505/mt CFR for the non-sanctioned one. One reason for the upturn is the Chinese price trend, while another one is the expected limited export allocation from Russia for September due to a scheduled maintenance at one of the major supplying mills.
In the domestic market for HRC in Turkey, the mills have overall moved on to September deliveries and, due to the uptrend in China, have pulled up their official offers by $5-10/mt to $550-560/mt ex-works and, moreover, some of the producers are hinting at $565-570/mt ex-works targets for next week. Taking into account a lower than medium level of stocks in the domestic retail market, some small purchases have been made this week mainly at $555-557/mt ex-works and at closer to $550/mt ex-works for the larger purchases. Still, most bids are at $540-545/mt ex-works but the mills are trying to resist for now. Export offers from Turkey are back to $530-540/mt FOB levels with no serious market talk reported lately due to silence in the EU.
The retail market, according to sources, is now at $595-605/mt ex-warehouse for hot rolled sheets with only $5/mt discounts available from certain companies. The extras for cut sheets are currently at $15-25/mt depending on the producer.