The Mediterranean and Black Sea
billet markets have remained unchanged compared to last week while the outstanding change in the market has been recorded in Chinese and Indian
billet prices.
The
CIS billet market has been keeping its prices at the same level for a long time. Ukrainian origin
billet offers and sales have been concluded mostly at $415-420/mt FOB Black Sea, while Russian producers are offering
billet at $420/mt FOB Caspian Sea and above levels. The
Middle East, excluding
Turkey, North
Africa and
Iran, is not showing interest in these levels. Particularly the month of Ramadan seems to be influencing the
Middle East market. Ukrainian producers are now making
billet sales mostly to Eastern
Europe countries. SteelOrbis has heard that Ukrainian sales levels are at $425-430/mt DAF.
The increase in capacity utilization rate of rolling mills due to long product
investments in the Turkish market along with the strong long product prices has increased
billet requirements. At the same time, not many
billet bookings have been heard lately in
Turkey from June since the
billet usage of rolling mills set in internal transaction certificate was filled. The
billet requirement of the Turkish domestic market grew further especially from the end of August. Turkish producers are not making much
billet offers for export since early September. For now, the
billet requirement seems exorbitant in the Turkish domestic market. Rolling mills are trying to supply
billet mostly from the domestic market. Rolling mills are not interested in these offers since they are for December shipments. The
billet price in the Turkish domestic market is at $455-460/mt this week. Meanwhile, it is not possible to find export offers below $445/mt FOB for December shipments.
A slight rallying has been heard in the Indian
billet market while even some producers have raised their
billet offers to $400-420/mt FOB. Chinese producers are forcing $380-390/mt FOB Chinese ports levels. Chinese
billet has increased due to the demand especially in
Southeast Asia. The strong position of Chinese and Indian
billet in international markets may support each other. However, the
billet price at around $355/mt in the Chinese domestic market makes market players wonder whether prices will maintain their levels or not in the next period.
If North
Africa and the
Middle East make a positive return to the market after Ramadan public holiday, the current level of
CIS billet may be acceptable. This situation may support strong
billet prices especially in the Mediterranean and Black Sea. Turkish-origin
billet seems to maintain its strong position in the domestic market and is not active in exports. After the public holiday, there might be competition between Ukrainian and Chinese producers in the Gulf region. Ukrainian producers seem one step ahead with their current price levels. However, if the Chinese
billet export prices show a decrease as some market players expect, Chinese producers may have an active role in the Gulf market.