The billet price level in Turkey’s import market has been rather unclear this week, mainly because there is a lack of offers from Russia while buyers are mainly keeping silent and are not asking for prices. No serious talks have been reported for import billet, while last week there were some successful negotiations.
According to sources, a 15,000 mt ex-Russia billet cargo was sold last week to Turkey at $555/mt CFR Izmir region, while another large lot was supposedly traded to the Marmara region at $550/mt CFR. This week, the number of offers is scarce as only a few suppliers are in the market. The ex-Donbass billet price level is estimated at $545-555/mt CFR, while the workable price for ex-Russia billet price is evaluated at a maximum of $560/mt CFR and maybe even lower than that. One of the reasons is the expectation for softer scrap pricing in the coming days and the relatively slow sales of long products abroad. Some sources report there are indications at $600/mt CFR and above, but they are not considered workable at the moment. “Such prices are simply calculated from the $660/mt rebar price which doesn’t mean it is the market level,” a source told SteelOrbis. “There are no direct offers and no talks. If anyone is saying he has an offer, he is lying or whoever is offering to him is lying,” a trader said.
The SteelOrbis reference price for ex-Russia billet has been cut to $515-520/mt FOB Black Sea on August 16, down from $525-530/mt FOB seen on Friday, August 12. Though there have been a critically low number of offers from mills this week and most official targeted levels have been much higher, the tradable price has moved down, reflecting the weakening buying sentiment. In particular, the competitive offers (which are far below $600/mt CFR Turkey) have been coming only for ex-Donbass billet and from one large Russian mill. Russian mills have faced problems with scrap purchases, having no money, while at the current export prices for many of them the costs are below the breakeven line. “In my view, the market is not above $560/mt CFR and most probably below this,” a source said. This $560/mt CFR corresponds to $520/mt FOB for a medium-size cargo.