The billet price trend in the Black/Azov sea region and specifically in Turkey as the key import destination has reversed this week, contrary to the positive sentiment seen in the Asian and the GCC markets. The workable prices for Russian and ex-Donbass billet have declined in Turkey, similar to the situation in the Turkish domestic market. Softening scrap prices and the previously active restocking in billet are among the key factors. However, most market players believe the downturn is a temporary situation and that prices will not fall sharply in the short run, mainly due to the positive situation in Asia and certain expected seasonal improvement in the rebar markets.
Currently, the lowest workable prices for import billet are heard at $560-565/mt CFR Turkey, down around $20/mt over the past week. Particularly, according to sources, a total of 10,000 mt has just been booked at $560-565/mt CFR northern part of Turkey by a Russian mill. Similar levels are said to be workable for ex-Donbass billet, SteelOrbis understands. “This is the level for toxic and troubled material, non-sanctioned Russia is higher,” a large trader told SteelOrbis. The most recent indications from the large Russian non-sanctioned mill have been heard at $590-595/mt CFR, down around $10/mt over the week.
The SteelOrbis reference price for ex-Russia billet has settled at $530-560/mt FOB Black Sea with the midpoint at $545/mt FOB, down by $15/mt on average since last week. The tradable price in the major destinations has been closer to the lower end of the abovementioned range, while most large mills have still been insisting on offers at the higher end. “It has already become impossible to sell at $580/mt CFR [to Turkey], even at $560/mt CFR [$530/mt FOB or so] it is not that easy to sell,” one trader of ex-Russia billet said. Most Russian exporters are offering for March shipment, and so they are not in a hurry to lower prices to the levels buyers want in most cases, though exceptions could be made if some mills need to book.
The non-Russian billet offers are still there, but most of them are not considered workable. The offers from the GCC and Asia have been trending up and are now estimated at a minimum of $620/mt CFR, while the latest deal was closed at slightly above $600/mt CFR last week. A position cargo from Algeria has been on offer at $595/mt CFR, down $15/mt over the past week with no deal reported. Suppliers from Iran, according to sources, has been offering truckloads of billet at $600/mt CPT to Karabuk and at around $580-590/mt CPT to the Iskenderun region.
In the domestic market, local Kardemir has announced billet sales at $635-640/mt ex-works depending on the steel grade and, according to the market, has been able to trade up to 20,000 mt so far. In the Iskenderun region, a 6,000 mt lot has been sold at $640/mt ex-works, down $15/mt over the past week. In fact, there are rumours about an even lower trade in the same area. In the Marmara region, the lowest billet price has been heard at $630/mt CPT lately.
Since the sentiments in the global billet market have been mainly positive and with the Turkish market among a few markets where billet prices have been corrected down following the trend of scrap prices, there are no expectations of a further quick fall in import billet prices. “The market is bullish. In Turkey, we saw just a correction of prices. Maybe there could be a few more deals at low prices from Europe or Canada, but I don’t think that the US will go this way,” a European trader said. “In general, billet prices are hardening, only in Turkey have we witnessed a decline mainly due to scrap and problems with finished steel sales,” a Turkish trader said.