Billet market sentiment has weakened in Turkey over the past week, following the downturn in both import scrap prices and in domestic rebar prices, which have put pressure on workable semi-finished price levels. As a result, local billet prices have declined, with buying activity still at low levels, as customers are aiming at even lower levels, while fearing additional price drops on the rebar side. Import demand has been at minimum levels, following two deals from China reported by SteelOrbis last week. The available billet allocations for Turkey, except from China, are quite limited currently.
Ex-China billet is now available mainly for September shipments and at $525-530/mt CFR Turkey this week, in line with the previous levels. No deals have been reported after the two cargoes booked last week at $525/mt CFR and, moreover, traders report that there is hardly any Turkish mill currently in the market seeking to book a large cargo. No offers from Indonesia and Malaysia have been reported and, moreover, considering the overall market downturn in Turkey, particularly the Malaysian mills may refrain from giving further offers, while Indonesia seems to be concentrating on other markets and in some cases on other products.
Iranian billet has remained present in the Turkish market, with the latest offers reported in the Iskenderun regions at $475/mt for ready lots and $485/mt for new orders, versus $480-485/mt seen last week, all on delivered basis. In the Karabuk region, the latest offers have been reported at $495-505/mt CPT and these are not considered workable, not since the latest Kardemir sales closed at $525-530/mt ex-works last week.
Suppliers of billet from Russia and Donbass, according to sources, are not keen on placing firm offers these days since the market is clearly heading downwards. Their indications have been reported at $510-515/mt CFR for July-August shipments. However, according to buyers, the workable levels for these origins, again considering the lower scrap prices, the latest Kardemir billet sales and the overall downturn in the rebar segment, should be at $500/mt CFR maximum. Some buyers even voice $490-495/mt CFR as a bid price idea. Still, Russian suppliers are not in a position to offer low levels now, given the firm local currency exchange rate ($1 = RUB 72.83). The SteelOrbis daily reference price for ex-Russia billet is now at $480-485/mt FOB, down $5/mt over the past week.
Local Turkish billet prices are driven by the slump in the rebar trade, with prices sliding to $575-585/mt ex-works in the southern regions, while even further $2-3/mt discounts are possible with cash payment. Billet prices in the Iskenderun region are at $540-545/mt ex-works with a small deal signed at the lower end of the range, overall showing a $5-10/mt drop over the past week. Considering the rebar market situation, buyers’ bids in the region are at $530-535/mt ex-works. In the Izmir region, some sources have reported $545-550/mt ex-works/delivered offers, down from $560/mt ex-works last week. Some suppliers, however, are keeping the same price levels though they are not workable.
