Prices for import and local billets in Turkey have improved generally over the past week and most deals have been done for local billet or import origins like Russia with rather short lead times.
The domestic billet offers in Turkey have increased by around $5-10/mt over the past week, based on higher scrap prices and the increase in workable prices for local rebar. Today, October 15, Turkey’s Kardemir announced billet offers at $500/mt ex-works for S235JR and $510/mt ex-works for B420 grade, up $8/mt from the previous sales. The producer managed to sell over 60,000 mt and closed sales before noon. This signals rather strong demand for local billets in Turkey, following scrap and rebar price improvements, and after the announcement that steel producers have to use a minimum of 25 percent of feedstock from the local market within the scope of the country’s inward processing regime, and also given the shorter lead times.
Offers in the Marmara region have been reported at $510-515/mt ex-works minimum, while in the Izmir region the levels are at $510/mt ex-works. In the Iskenderun region, deals for over 15,000 mt are reported to have been closed at $515/mt ex-works. Still, some buyers consider $505-510/mt ex-works is still achievable.
At the same time, demand for Asian billet has been rather weak in Turkey even though some offers are down in contrast to the general trend in Turkey. Import offers from China have decreased by another $5/mt over the past week to $460-465/mt CFR at the lowest for November shipments, with not much interest seen among buyers, although the prices are quite workable against the current production costs of Turkish mills. According to sources’ estimations, with $345-350/mt CFR import scrap levels, Turkey can produce billet at $500-505/mt. “If it [the downtrend in futures] continues like this, we might see the $455-460/mt CFR range,” a trading source told SteelOrbis. “I think they may bid at $450/mt CFR to test what might be the bottom,” he added.
Offers from Indonesia have been reported at $470/mt CFR for December shipments with no interest seen yet. In addition, a cargo from Malaysia seems to have been offered at $480-482/mt CFR, down slightly from last week’s deals at $484/mt CFR, as SteelOrbis reported.
One of the Ukrainian mills is offering billet for December at $500/mt CFR, up from the latest workable level of $485/mt CFR seen at the end of September. Another Ukrainian producer prefers to remain out of the market for now and to evaluate the market situation.
The only active import purchases by Turkish buyers have been seen for ex-Russia billets with over 50,000 mt of billets traded at $455-460/mt CFR this week. Short lead times and the possibility to buy in small lots have been the major advantages. New offers start from $465/mt CFR.