Billet buyers in Turkey are still mainly refraining from active and large purchases in the import segment, particularly being cautious due to long lead times. Although ex-China billet offers have softened further over the past week, Turkish mills’ price ideas are still much lower than sellers’ expectations. Overall, while rebar workable prices remain weak and Asian billet is mainly offered for end-of-November delivery at the earliest, it is logical that billet importers in Turkey should aim to avoid risks at present.
As a result, integrated producer Kardemir has, in line with expectations, succeeded in selling over 56,000 mt of billet at the newly announced price of $492/mt ex-works for S235JR and $502/mt ex-works for B420. The supplier’s previous price in mid-August was $8/mt higher. The billet sellers in the other regions of Turkey are trying to maintain offers at $500-505/mt ex-works, particularly in the Iskenderun and the Izmir regions. Some negotiations may result in medium-sized deals soon, market players think.
Import offers from China are now at $470-475/mt CFR for October shipments, with some levels $2-3/mt higher also reported in the market. Buyers’ bids, however, remain rare and still do not exceed $460/mt CFR, SteelOrbis has learned. “Price-wise Chinese billet levels are acceptable for Turkey, but the delivery is too far long. It is hard to say what rebar business will be like for November-December production, certainly not bright, but not worse than today?”, a trader commented to SteelOrbis. Currently, the local workable prices for rebar are at $530-545/mt ex-works and slightly higher in some cases, while for exports the buyers do not accept $530-535/mt FOB and are targeting levels $5-10/mt lower.
The indicative offers for Indonesian and Malaysian billet are still reported at $485-487/mt CFR and $490/mt CFR, respectively, with no interest heard. One of the Ukrainian mills is offering at $490/mt CFR for October-November shipments to Turkey, with not much positive response seen from the buyers’ side.
A number of deals for Russian or Donbass origins amounting to 40,000-50,000 mt in total were signed at $460-465/mt CFR to Turkey late last week, stable compared to the previous sales of the same origins done earlier in August. This price translates to $440/mt FOB Black Sea on average. Also, there has been a rumor that one mill bought a sizable lot at $468/mt CFR, but this information has been denied by market sources, saying that bids from large buyers would be $463/mt CFR at the highest.
“Exports of billets are unprofitable for Russian mills, considering the exchange rate at $1= RUB 80,” a trading source said. Most traders are not eager to buy from mills at prices equivalent to above $435/mt FOB Black Sea due to financial issues, in particular during sales to Egypt. Moreover, “Russian traders have now additional problems due to strict controls and diving inspections of vessels entering the Russian Federation from foreign ports [especially if the previous voyages were from Ukrainian ports],” a source said.
The SteelOrbis reference price for ex-Russia Black Sea billet stands at $440/mt FOB, inching up by $0.5/mt from the previous average level.
