Local flat steel prices in Russia have been increased substantially over the past month with the mills reporting still decent demand from domestic customers, while availability is still partially limited. In the meantime, the exports of flats from Russia to distant markets have been almost muted since most of the buyers are not ready to absorb the seven percent export tax, while their bid prices are not workable for the suppliers. Instead, some demand has been seen from neighboring countries from the CIS.
According to market sources, one of the key Russian flats producers has announced its domestic flats offers with an increase of around $15-25/mt (RUB 1,000-2,200/mt) over the past month, depending on the product group. The supplier’s hot-rolled coil (HRC) and hot-rolled sheet (HRS) is now available at $548/mt (RUB 64,500/mt) and $561/mt (RUB 66,000/mt), both on CPT basis. Cold-rolled coil (CRC) is on offer at $650/mt (76,500/mt) CPT, while cold-rolled sheet (CRS) can be booked at $663/mt (RUB 78,000/mt) CPT, SteelOrbis has learned. Other suppliers in Russia’s domestic market are offering their material at around the same level. “We are at around the same levels, maybe RUB 200-300/mt [$2-3/mt] more for some positions,” a producer said. ($1 = RUB 97.1.)
Currently, Russian mills, according to sources, are barely present with HRC offers in markets like Turkey or North Africa. One reason is that the competition with Chinese offers in the region at around $560-575/mt CFR is not leaving much room for Russia to include the export duty of seven percent in the price. However, currently, there is increased demand from some of the CIS states. “Kazakhstan, Uzbekistan, Kyrgyzstan, and Azerbaijan are buying and even the countries which are not part of the Eurasian Economic Community agreed to higher prices to compensate for the duty,” a source said, having added that the export availability from some of the mills is limited. According to some sources, the equivalent of these sales may be up to around $600/mt FOB including the export duty and logistics to ports or close to $520/mt ex-works, which is considered an acceptable level. Such FOB prices, however, are definitely not workable in the international markets.