Insufficient demand, aggressive offers from China and the negative scrap market trend have urged Turkish hot rolled coil (HRC) buyers to seek lower levels from their suppliers, both local and foreign. In the meantime, mills are trying to avoid decreasing their prices officially and prefer to deal with each customer individually, looking to receive firm bids.
While some domestic HRC mills in Turkey are still officially at $800/mt ex-works base, others have been voicing levels closer to $780-790/mt ex-works, all for April production. “Nobody wants to announce big decreases these days and they prefer to go from door to door collecting bids. But there are none,” a source told SteelOrbis. Similar levels are being voiced for exports, but some sources believe that for direct sales Turkish mills may negotiate at $765-775/mt FOB.
Along with the downturn in the import scrap segment, the still attractive HRC offers from China are among the key reasons for Turkish buyers being cautious. The latest ex-China deal, for 20,000-25,000 mt for March shipment, has been reported at $685-690/mt CFR, while the previous deals for the same shipment had been closed at $705-720/mt CFR in the past couple of weeks. “It is a huge difference in prices compared to the local mills in Turkey and I think they want to avoid official price drops as one would need a decrease of at least $50/mt in one shot. And there are still hopes that China will leave the market soon,” a trader said.
The CIS-based mills have also seen no luck in sales to Turkey and also prefer to collect bids. Russia’s MMK is offering at $770/mt CFR officially, admitting that such a level is of no interest for customers. Offers ex-Ukraine are also vague and customers expect the mill to be ready to sell at $740-750/mt CFR depending on the coil weight, while last week $760-770/mt CFR levels were considered workable by the mill. Some market players, however, believe the bids to the seller will be in the range of $730-735/mt CFR.
