The Turkish domestic merchant bar market has failed to show signs of activity due to the fairly low $/TRY exchange rate and also since the Turkish domestic billet price level is at $510-520/mt. The dollar-based prices are changing daily, with certain alterations in demand levels being seen as well. Contrary to the beginning of 2007, no scarcity of material exists in the Turkish domestic merchant bar market at the moment. Although some scarcity can be seen in NPU, NPI and in some angle sections at the moment, compared to the situation at the beginning of 2007 it is easier to find the products in question at present. The respective price ranges of angles, flat bars and NPU-NPI in the Turkish domestic market are: TRY 750-770/mt ($632-648/mt), TRY 770-800/mt ($648-674/mt) and TRY 770-790/mt ($648-665/mt). All prices exclude VAT.
It appears the Turkish producers have been turning their attention to new markets due to the fact that demand from Europe is at a considerably low level. Chinese offers are not attractive anymore due to the rising freight rates, especially given that Chinese origin angles are at a level of $650/mt for December shipment. The Turkish producers's angles prices of $640-650/mt FOB and flat bars prices of $650-660/mt FOB have attracted a rise in demand from the Middle East, especially from the United Arab Emirates.
The domestic markets in Europe are still calm. Stockists have been purchasing from domestic producers since the demand level is not strong. Although the demand for big sections is not great, it is still stronger compared to the demand for small sections. For this reason, the prices of big sections have not seen noticeable change. The Bulgarian domestic market is also calm. The local price levels of angles and flat bars price in this market are in a range of BGN 990-1,000/mt ($743-750/mt), excluding VAT.
The global merchant bar market is likely to remain unchanged for the rest of 2007. Although there are optimistic expectations for 2008, we will only be able to gauge the market's direction once the expected pickup in buying activity begins after mid-January. The decisive factor in this process will the presence of strong signals from the construction sector.