CIS-based billet exporters have become very bullish in the middle of this week, targeting prices $40/mt higher since Wednesday, October 13, seeing sharp rises in the Turkish market. A lack of firm offers has been seen in the market now, as most producers do not exclude further rises as scrap prices are coming closer to $500/mt CFR.
Though large mills have been avoiding giving official offers, they have been seeing the targeted price levels hardly below $670/mt FOB, SteelOrbis has learned, while just on Tuesday, October 12, the tradable level was at $625-630/mt FOB. There has been information about a large Ukrainian mill selling at around $670/mt FOB to Turkey, translating to above $700/mt CFR, which, however, could not be confirmed by the time of publication.
The mills’ previous targets were at $630-650/mt FOB Black Sea on October 12. But since then local billet prices in Turkey have surged, making suppliers more bullish. “This increase is isolated in Turkey,” a trader said. At the moment, the tradable level in Turkey has been assessed at $680-700/mt CFR Turkey, but “there are no billet volumes, all [suppliers] are waiting,” according to a local source.
“There are inquiries [from other outlets]. But the current crazy price hike is caused only by Turkey,” one CIS producer said. Taking into account that the scrap prices in Turkey have still room to go up and that positive sentiment has not faded, CIS billet exporters are unlikely to offer any price level below $650/mt FOB even for other trading destinations.
At the same time, apart from Turkey, the market for ex-CIS billet has been far from positive. The latest deals to Africa and Europe have been heard at above $620/mt FOB, but after that no new price indications have been reported so far.
In China, bids have slipped to around $700/mt CFR, which corresponds to $600/mt FOB Black Sea and it is out of the range of interest of suppliers. “China has cut energy prices, so re-rolling operations will be improving and we believe that demand for [import] billet will return. But now the situation is bad there,” a source said.
The SteelOrbis reference price for ex-CIS billet has been settled at $650-670/mt FOB Black Sea on October 14, up by $32.5/mt on average from early this week and up $52.5/mt from late last week. The price level is down $15/mt on the lower end since yesterday, as information about the tradable price levels at other destinations apart from Turkey has been included.
