The billet market in Turkey has seen relatively livelier business activity this week, following a period of stalled trading. Particularly, in the domestic market large volumes have been sold by integrated producer Kardemir and, although the price was low, some of the market sources have viewed the volume of sales as a positive sign. Many believe that the market for billet, at least for local and some import origins, may have hit the bottom. In addition, the number of import options has been quite limited, especially for medium volumes and for relatively short delivery times.
Today, March 21, Kardemir has traded a little over 55,000 mt of billet in the domestic market at the announced prices of $545/mt for S235JR and $555/mt for B42 grade, both on ex-works basis. Prior to that, many believed that Kardemir would announce a higher price level, based on the sizeable rebar sales concluded earlier at around $608/mt ex-works. “This is their [Kardemir] sort of averaging round and the next price will be very high,” a trader told SteelOrbis. With Kardemir’s sale, the indicative domestic prices for billet are at $545-565/mt ex-works, down $10/mt over the past week. However, they may rebound in actual deals, based on rebar prices in the local market roughly being at $600-620/mt ex-works.
Offers volumes for ex-Russia billets have been limited lately and only small deals for prompt shipment have been reported. Another 10,000 mt in total of Russian billet for prompt shipment have been sold to traders at $515/mt FOB, almost in line with the previous bookings at $517/mt FOB, with the same lead times. But the lots are again for the Egyptian market. The SteelOrbis reference price for ex-Russia billet has settled at $505-515/mt FOB, with the midpoint up by $5/mt to $510/mt FOB since late last week.
As for Turkey, a few small prompt shipment sales for Russian origin have been done at near $540/mt CFR. But for shipments in late April and beyond, the market has been almost halted as Turkish steel mills are still looking for $510/mt CFR, translating to $490/mt FOB. However, “there are almost no offers from the Russian Federation. The minimal price [from the sellers] is $530-535/mt CFR and for small volumes. Turkey is not ready to buy yet,” a trader said. A small deal for ex-Donbass billet has also been heard, at $523/mt CFR, but this has been a renegotiation from a previous sale.
Sources believe there might be a certain additional interest in other billet origins such as Algeria and Ukraine, which are able to supply 10,000-15,000 mt lots and for a relatively short lead time. There has been information about a position cargo from Algeria sold at $535-540/mt CFR earlier this week. As for Asian material, the FOB levels are assessed by the Turkish side at $500/mt FOB, but the freight rates are quite high and are making the CFR offers unattractive. Particularly, according to sources, the freight rate for 50,000 mt is at $35/mt and for 30,000 mt stands at $45/mt. “In this market, no one is in a position to buy such large lots, at least not right now,” a trading source told SteelOrbis.
