The Turkish domestic rebar market is surprisingly continuing its high price trend ahead of the national elections. The decline in the US Dollar-Turkish Lira exchange rate caused prices to increase in terms of the US Dollar since the TRY-prices are almost at the same levels. Overall Turkish domestic prices are at around $590-600/mt ex-works, excluding VAT. The fact that traders have very low stock is helping to boost market consumption of producers' products. This situation provides support for prices to maintain their firm levels, by preventing stock accumulation at producers' warehouses.
Turkish rebar export prices have dropped to around $560/mt FOB level in previous weeks, but the ending of the declines in the scrap and billet markets, and the increase in the Euro-US Dollar exchange rate, have helped Turkish producers to conclude some bookings. Producers are trying to achieve sales at $580/mt FOB and over for Europe towards the end of the week.
The price level of imported rebar in the UAE market has not fallen below AED 2,300/mt ($626/mt) delivered to site on a theoretical weight basis for 3- and 5-month deferred payment, excluding VAT - despite the fall in import rebar offers. The latest bookings in previous weeks for import were at around $575/mt CFR. Customers are seeking lower price levels. However, Turkish producers prefer to wait and see due to the slight revival in the market.
The overall decline in Europe has not stopped this week either. There is a negative trend prevailing in Spain, Italy and Portugal. It was possible to find a base price at €285/mt (12 mm AENOR-certificated rebar €505/mt DDP) in Spain and $240-250/mt (€440-450/mt DDP) in Italy. The noteworthy market in Europe this week was the UK. However, this market was affected negatively by the sales concluded from the Iberian peninsula, northern Europe and Turkey.
There is a sign of hope in spite of the adverse situation experienced in southern Europe. Stock levels in Europe have recorded a significant decline due to the panic in this market. Turkish producers' export offers have started to rise with the help of the Euro-US Dollar exchange rate. Rolling mills in the Middle East have purchased huge billet quantities and raised their billet prices. This situation seems to be an indicator of the bottom point in the Middle East domestic prices. If the feeling of panic comes to an end in Europe, especially in Italy, and if prices rally, Ukrainian producers may not have to lower their prices next month in order to compete in North Africa. As a result, the negative trend experienced in the Mediterranean and Black Sea over the past two months may shift to a positive trend.