CIS steel producers have increased their new offer levels for exports to the Turkish market, where the demand level is currently floating sideways.
Flat rolled steel producers in the CIS have started to announce their new price levels for September production. The new price levels are observed to indicate some degree of increase, as previously expected.
As indicated in our last week's analysis, the price level of hot rolled coil offers by Russian producer Severstal to Turkey is at $760/mt CFR and at $870/mt CFR for cold rolled coils.
Last month, Russian producers were offering August production hot rolled coils at $730-740/mt CFR and cold rolled coils at $840-850/mt CFR. In view of these previous price levels, buyers find the newly announced higher offers a bit high for the moment. The $20-30/mt increases in the new offers are not expected to be fully accepted, and the market is questioning whether the new price levels will ever be accepted even granted some amount of discounts from the producers.
Last month, Ukrainian producers offered hot rolled coils to Turkey at $710/mt CFR and deals were concluded at $690-700/mt CFR. New offer levels have started to be announced slowly, with $10-20/mt increases heard to have been made over the past month. Ukrainian producers' new offer levels for the Turkish market are expected to become clearer this week.
In the domestic market where Turkish producers are offering $750-760/mt prices for hot rolled coils for September and October production, demand is currently quiet. The inactive state of the market under the influence of the Ramadan period also adds to the doubts whether the new increased CIS offers will ever be accepted in this market. Market players are expecting discounts to be given depending on the purchase volumes seen last month.