The UAE, which has concluded large tonnage rebar deals from Turkey in particular in recent weeks, has been exciting buyers in both Turkish domestic and foreign markets. While export price levels have this week been in the range of $380-400/mt, rebar prices may not decline below current levels due to the following factors: scrap prices have been maintaining their resistance to the finished steel and billet price trends in recent weeks; this resistance is expected to continue in the upcoming weeks; and purchase activity may be seen from the Middle East, and from Dubai in particular.
While rebar consumption has increased in some regions in the local Turkish market due to the upcoming elections, it is observed that some Turkish producers have abstained from mentioning price levels or have mentioned high price levels in both the local and export markets on the back of the purchase activity from Dubai towards the end of last week. With the slowdown in the decline rate of rebar prices in recent days, more and more market players are of the view that rebar prices will either maintain their current levels or else see an increase. With stocks at low levels at the current time, it is observed that buyers are monitoring movements both in the international and local markets with great care.
Having desperately sought stable prices in recent months, buyers do not expect sharp and rapid increases on account of the sluggishness of end-user demand, and they may abstain from purchases if there are sudden increases. It is also a source of interest whether Turkish producers will step up production if demand from the Middle East gains momentum again.
While Turkish rebar export offers were at around $370/mt in October 2008, the price level subsequently increased to $510/mt FOB, before declining to the current level. It is possible that ex-Turkey rebar price levels, which have not fallen down below $380/mt FOB for a week or two now, may see an uptrend again or post a stable trend at least.
We will gain a better idea of the direction of rebar prices in the upcoming days.