Demand in Turkish billet market slows down slightly

Supply in the local Turkish billet market has continued to remain tight this week, while demand has slowed down slightly due to Ramadan and also due to the impact of the announcement of a possible reduction in customs duty on rebar imports. Meanwhile, domestic billet prices in Turkey have remained unchanged over the past week at $430-440/mt ex-works.
 
Chinese billet suppliers stayed away from the export markets during the Dragon Boat Festival holiday on May 29-30 and their billet export prices are still at $420-425/mt FOB, following the $5/mt increase recorded towards the end of last week. Chinese billet prices have been moving up and down for a while now in line with the fluctuations seen in the Chinese steel futures markets and in iron ore quotations, though Chinese billet prices have not indicated any sharp decline because domestic demand for billet in China has improved slightly. However, current Chinese billet export prices are not attractive for Turkish buyers and so no new deal for Chinese billet is expected to be heard in Turkey in the short term.
 
Meanwhile, ex-CIS billet offers to Turkey have remained stable during the past week at $410-430/mt CFR.
 
Due to difficulties in procuring domestic billet, Turkish buyers have recently increased their price inquiries for Iranian billet and there are rumors of Iranian billet transactions being concluded by Turkish steel producers at $410/mt CFR.
 
Liquid steel producers in Turkey prefer to continue their production with scrap, while Turkish rolling mills are still cautious about concluding new deals for import billet within the scope of Turkey's inward processing regime (under this scheme mills have to give a commitment to export the finished products they produce from imported billet) and so they are purchasing import billet only in line with their needs.