Prices for ex-CIS billet have indicated some further decline in the first half of this week as slow demand and uncertainties for the near future have exerted significant pressure. Most Russian suppliers have been out of the export market as most of them are preparing for a price increase due to the introduction of 15 percent export duty from August 1.
The latest offers from Ukraine have been reported at $640/mt FOB and slightly above, down by at least $10/mt from last week. While “for large volumes, the price can go down to $630/mt FOB,” a source at an exporting mill said. But it is expected that these lower prices will be valid only for a short period of time as Russian suppliers are expected to come back to the market with higher offers next week. “We are waiting for a move from the Russian Federation,” a Ukrainian source said.
The latest deals for ex-Ukraine billet to Turkey have been heard at $670-660/mt CFR and the lower end of the range corresponds to a sale of eastern Ukrainian billet, which is usually priced at lower levels. But in general, the market has been quiet and uncertainty has prevailed. “We want to understand the effects of the duty a little, especially in the Russian local market,” a trading source from Turkey said.
The steel export tax initiative in Russia was approved by the Russian authorities late on June 25. The base export rate will be 15 percent or not less than $115/mt for semis from August 1 to December 31 this year. “No one offers from Russia now. We try to understand the effect. Local rebar prices have started to go down, but they are still at high levels,” a Russian producer said.
The SteelOrbis reference price for ex-CIS billet has been lowered by $10/mt since late last week to $630-640/mt FOB.