Russia-based flats producers have received an opportunity to activate their export presence in the Turkish hot rolled coil (HRC) and slab markets once again, taking into account that the flats prices in Turkey have surged since early September. Although the price increase is more cost-driven rather than connected to higher demand, buying activity has still been rising since customers fear further price rises.
Following Turkish mills’ move to increase local HRC prices to $700/mt ex-works on average, Russian suppliers have started to receive higher bids for their products. As a result, according to sources, one mill has succeeded in trading a medium volume at around $620-625/mt CFR and up to $630-640/mt CFR for small lots, while the indicative offer level was set at $650/mt CFR, as SteelOrbis reported earlier. Another Russian mill reached an agreement with a Turkish buyer at around $600/mt CFR early this week, while the following deals closed at up to $615-620/mt CFR. The company intends to sell around 20,000 mt in the current round of bookings. The third Russian flats producer has not announced prices for export, being sold out in the local market. Before the increase, HRC offers from Russia were at $560-590/mt CFR.
Currently, the ex-Russia mills active in exports are selling for October production. As expected, NLMK and Severstal will have reduced HRC sales volumes for this month, taking into account scheduled maintenance works. One of them is going to stop its rolling line for around a week in October. Another producer plans to stop its bigger hot rolling line (2000) for around a week in October and in November expects repairs at the heating furnace at its other rolling line (1700). This might take almost a month and will result in the partial loss of productivity, given that the facility is equipped with two furnaces, SteelOrbis has learned.
In the import slab segment, a Russian steel producer has managed to sell two lots at $500/mt CFR, up from the previous deals of $470/mt CFR. The supplier’s new offers are at $530/mt CFR, sources report. South Korea has also appeared in the market, as expected, following the recent accident, and has been offering $600/mt CFR, though for 250 mm slabs. “Such a size is not suitable for all [mills in Turkey]. Only some EAF-based mills can roll it, though with some technical adjustments and loss of productivity,” a source told SteelOrbis. Market players believe South Korea has a bigger chance to sell slabs to the EU, where they are offering around $650/mt CFR.
