Domestic HRC producers in Turkey have started to target higher prices, increasing official offers by $20/mt, owing to recent hikes in the scrap segment and the better mood in general. Some Asian HRC suppliers have also not been as aggressive as early in the month and some of them like China have been even bullish. Nevertheless, the latest bookings have still been done in Turkey for ex-Asia coils, as they have remained the most competitive in term of prices.
According to market sources, a deal for 10,000-20,000 mt of ex-Vietnam HRC has been done at $570-575/mt CFR, which in in line with the lower end of the tradable price range in Turkey reported last week. In addition, up to 30,000 mt of ex-Indonesia HRC have been sold at a similar price level. Market sources said that some improvement in sentiments has led to a gradual increase in trading, though overall market fundamentals have not changed much.
Other Asian suppliers have been offering at higher levels. Indian HRC offers to Turkey have remained stable compared to last week - at $585-590/mt CFR. Japanese mills have been ready to sell at $580-590/mt CFR this week. At the same time, Chinese sellers, previously aggressive, have increased their offers by $20/mt to $590-600/mt CFR Turkey. “This is a good sign,” a market source said.
Russian HRC suppliers have been inactive in Turkey recently with offers from the major mills at $560-580/mt CFR. There has been no interest from the buyers’ side as discounts for ex-Russia HRC are usually bigger.
Another proof of the improved situation in the Turkish HRC market has been the higher local prices. Thus, most major producers in Turkey have voiced their official offers at $640-660/mt ex-works, which is up to $20/mt above the previous levels. Market sources believe that the major drivers of this move were the scrap price increase and better sentiments, rather than a real demand improvement. So, the tradable level in the local HRC market is still hardly above $630-635/mt ex-works.
Though this is still below target levels of most mills, bids in the market have also posted some slight increase. Last week, the workable level was at $620-625/mt ex-works in Izmir. And the sale of one of the major mills to Marmara was done at $630-635/mt CFR, which translated to $605-610/mt ex-works. As a result, the SteelOrbis reference price has increased just slightly from the previous $620-640/mt ex-works to $630-640/mt ex-works.
