Nowadays when European mills have returned from holiday, it is observed that the activities in the Middle Eastern market have slowed down. This slackness has been felt in the Middle Eastern markets in particular during this week. As Europeans have just returned from holiday, they are currently examining the market, receiving offers and waiting for the Q4 prices to be announced by the European mills in following days.
In Italy, Ilva's base prices for HRC are standing at €770/mt ex-mill this week; however, the mill is expected to issue its new base prices in the coming week. Offer prices for Italian buyers - who are receiving import offers this week- are varying in a range of €630-730/mt CFR Italy for October shipments. However, no booking has yet been heard at these levels. The main reason for this is the imminent price announcement to be made by Riva Group. It is heard that there are offers from China for HRC at around €630/mt CFR Italy. Ex-Egypt price offers for HRC are standing at €730/mt CFR Italy. With little activity is seen in Spain, price offers have recently started to be received and reasonable prices for HRC are estimated at €690-700/mt CFR Spain. Also it should be taken into consideration that HRC offers from China are at lower levels.
With the gradual commencement of activity in the Romanian and the Bulgarian market, the expected recovery has not been posted yet. Until the first half of 2008, the Romanian market showed a strong progress. Ex-Slovakia and Serbia HRC offers are at the level of 760-780€/mt DAF Romanian border. Offers from China for HRC are standing at lower levels. In Bulgaria, as regards the stockists, prices for HRC are standing at €720/mt ex-warehouse, while Kremikovtzi's price offer for HRC varies in a range of €650-660/mt ex-mill. On the other hand, Kremikovtzi's HRC offers for southern Europe are standing at €715-725/mt CFR southern European ports. The most recent Ukrainian offers for HRC to the European borders are standing at $1,030/mt DAF.
Ramadan has already affected the Middle Eastern markets. In the United Arabian Emirates (UAE) HRC offers from Ukraine are at the level of $990/mt CFR UAE, while offers from Russia are standing at $950/mt CFR Dubai. There are also strong declines seen in HRC offers from China. Recently, Chinese offers on CFR Dubai base have decreased to the level of around $910/mt. Buyers from Dubai are currently waiting for imports; however, they are trying to maintain the domestic prices, though there has been an adjustment for domestic sales prices. The main reason for this is the buyer's wait for the previously booked materials. It seems likely that the UAE market will see more activity following the month of Ramadan. Slow demand is also seen in the other Middle Eastern countries, due to the Ramadan.
It is foreseen that the Europeans will return to the markets as soon as the Q4 prices are issued. Nevertheless, it is likely that the Middle Eastern buyers will return to markets after the end of Ramadan.