After witnessing price declines in early July, the Turkish flat steel market has not seen any significant price movements this week, while demand has shown a slight improvement. Reduced specification variety in inventories has led traders to make new bookings and this has resulted in intensive negotiations between traders and steel producers. Last week, traders considered that flat steel prices in Turkey had hit the bottom. For some market players, this week's sideways price movement has supported this opinion and some traders have started their bookings, considering that prices may begin to increase. However, some market players still believe that there is still room for further price declines, and so they continue to delay their purchases. In the meantime, a slight demand improvement for cold rolled coil (CRC), coupled with the narrowing in CRC supply, has caused a slight price increase in the domestic CRC spot market this week.
Turkish steel producer Erdemir has kept its September production hot rolled coil (HRC) offers stable at the base price level of $750-760/mt ex-works, while HRC offers given by domestic producer Çolakoğlu Metalürji are also at $750-760/mt ex-works, for late August rolling. However, SteelOrbis has learned that some high volume transactions have been concluded below these price ranges.
Since early this week, HRC spot prices have trended sideways in general, while CRC prices have seen increases by as much as $10/mt as compared to last week. Accordingly, in this week's Turkish domestic spot market HRC offers have been at $755-765/mt, while 1-1.5 mm cold rolled coil (CRC) offers have been at $890-910/mt, with prices of thinner CRC specifications at $930-960/mt, all ex-warehouse.
As SteelOrbis has previously reported, according to the Turkish Automotive Manufacturers Association (OSD), in the first half of 2011 motor vehicle sales in Turkey totaled 445,090 units, rising by 53.9 percent as compared to the corresponding period of the previous year. In the given period, Turkey's motor vehicle exports came to 417,348 units, rising by 4.5 percent year on year, while the revenue for these exports sales totaled $9.42 billion, increasing by 15.8 percent. Such a strong performance of the Turkish automotive industry indicates that CRC and galvanized coil consumption in Turkey will likely remain strong in the coming months.
While the Turkish machinery industry has remained sluggish, it is predicted that a recovery may not be seen until September this year. On the other hand, the Turkish shipbuilding industry is also quiet, resulting in reduced shipbuilding plate demand in the country. It is heard that Ukrainian steel producers' shipbuilding plate offers to Turkey stand at $800-810/mt CFR, for August and September shipments.