Local rebar prices in Russia have weakened since the second half of June, partly due to the recent export tax imposition. Still, Russian mills consider the current situation to be normal and prices are still much higher than export options. In addition, domestic rebar demand in Russia is still strong enough.
Over the past week, local rebar prices in Russia have decreased by $24/mt (RUB 1,500/mt) on the lower end and by $6/mt on the upper end due to currency fluctuations. Today’s price range has settled at $830-859/mt (RUB 72,500-75,000/mt) ex-works/CPT depending on the region and the producer. “The decline is normal because the prices were already too high and they are still higher than the levels we can receive from exports,” a source told SteelOrbis.
Export offers for rebar from the CIS are at $740-750/mt FOB, specifically for African countries. Moreover, ex-Russia suppliers may disregard exports completely due to the recently announced export tax of 15 percent or a minimum of $115/mt to be valid from August 1 to December 31 this year. “Local and export prices are already around $100/mt apart and the additional $115/mt will be borne by the supplier since there is no market in the world which can absorb such an increase,” a producer told SteelOrbis.
Most sources agree that domestic rebar prices in Russia will continue to decline, although some believe the downturn will be curbed somewhat by still active internal demand. “Russia has not been an active exporter in past weeks and yet local buyers have been ready to pay $850/mt levels. So it is also a matter of the seasonally high activity,” a mill said.
Prices in US dollars exclude 20 percent VAT.
$1 = RUB 72.8