With Turkish billet producers hiking their billet prices to a level of $560/mt last week, and in particular given the rise in Kardemir's billet prices, Turkish merchant bar producers also increased their prices. The expectation that billet prices would rise had already caused producers to abstain from giving offers. With the rise in billet prices last week, export offers at $690-700/mt FOB have started to be quoted in the market. We will see this week how buyers react to these levels.
Although last week's rise in local billet prices was not reflected in the local merchant bar market, the increase is expected to show its impact on merchant bar prices this week.
In our analysis last week, we mentioned that the European market was calm. Since then no change has been observed in prices, and the market has maintained its calm. While merchant bar prices in Italy are at €460/mt ($683/mt) delivered to warehouse, producers are offering merchant bars for export at €470-475/mt FOB ($698-706/mt). Demand in the UK is not brisk. In the local market, merchant bar prices are at £360/mt ($744/mt) delivered to warehouse. In Romania, local merchant bar prices are at $714/mt.
The rise in the prices of raw material and semi-finished steel products may have a positive effect, particularly on the merchant bar prices in Europe. If the European market improves and if North Africa and the Middle East continue their purchases, then new prices may gain acceptance.