European rebar market remains quiet, whereas Turkish producers seek to raise prices

Friday, 06 November 2009 14:39:39 (GMT+3)   |  
       

Thanks to the stable price levels observed in the raw material and semi-finished markets as of last week, Turkish rebar producers have been able to keep their prices at certain levels, with prices below $450/mt FOB not mentioned this week.

Turkish mills have this week continued to conclude sales to the African market in particular, with their export prices in the range of $450-460/mt FOB. In general, it is thought that prices are unlikely to decrease below those mentioned above, as the downtrend in Turkish producers' prices has come to a halt recently and as some stability is now seen in prices. In the meantime, the stable price trend has also received support from this week's new scrap offers, which have registered an increase compared to last week.

Not many rebar offers have been heard from Turkey to the UAE this week, with the latest Turkish rebar offers to this country given at approximately $470/mt CFR. It is known that UAE buyers are expecting lower prices for import materials as their domestic numbers are at AED 1,850/mt ($504/mt). It is expected that prices and purchase strategies in this region will gain greater clarity as of next week.

In the rest of the Middle East, nothing has changed as regards prices and demand compared to last week. For instance, demand in Saudi Arabia has been indicating flat levels and market players think that price levels will follow a stable trend due to the approach of the season for the annual pilgrimage to Mecca.

In the local Turkish market, with its new price list dated November 5, 2009, Turkish steel producer Kardemir opened its domestic sales for 12-22 mm diameter rebar at the price level of TRY 808.30/mt ($458.27/mt + VAT) ex-works and including 18 percent VAT. It is heard that no great amount of purchase activity has been seen at this price level and that buyers are hesitating to buy material for their stocks since the market is expected to slow thanks to the seasonal stagnancy in construction projects.

Looking at Europe, demand is still observed to be weak. With bookings in the region seen just for small tonnages, price policies are being shaped by competition levels. It is heard that some producers in the region may suspend their production if no change is seen in the current situation.

While southern Europe origin rebar offers to the export markets have this week been at €320/mt FOB, the lowest offers given to Algeria, the most important rebar market for this region, have been heard at €325/mt CFR. Still, contrary to expectations, Algeria has not yet entered purchase mode. In addition, the softening trend seen in the southern European markets in recent weeks has also been observed this week. Demand is not so brilliant in the local markets, just like the situation in the export markets.

On the eastern European side, rebar offers given to the export markets from mills in Poland and Latvia are in the range of €300-305/mt ($445-453/mt) FOB on actual weight basis. Meanwhile, rebar prices in the German domestic market have decreased to €315-320/mt delivered to customer. Tonnages in bookings in these regions have also decreased considerably.

In Europe in general, raw materials have continued to determine rebar prices. While demand for rebar in general is still weak in the continent, the coming days will show how the European markets will be affected by the price increase attempts which started in Turkey.


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