Import billet prices have continued rising in Turkey, pushed up by stronger scrap prices. The number of negotiations for billet purchases is minimal for now and only a few offers have been voiced, and so the sellers and buyers are waiting to evaluate workable prices.
Last week ended for the Turkish market at around $550-560/mt CFR levels and, according to sources, a 20,000 mt lot was booked from a large Russian mill at $560/mt CFR which is around $520-525/mt FOB. However, this week some offers for Russian and Donbass origin billet have been voiced at $600/mt CFR and above. The highest reported indication is at $630/mt CFR, but sources believe the trader is just testing the market to see buyers’ feedback. Turkish customers, however, are not in a rush to book at these levels, although the spread with rebar at $700/mt FOB is more than affordable. In the meantime, domestic billet offerings are practically not seen, partly as the sellers are trying to evaluate the price trend and also Kardemir is expected to open its sales on Wednesday.
As of June 4, SteelOrbis increased its daily reference price for ex-Russia billet by $17.5/mt since Friday to $520/mt FOB. However, according to the latest offers circulated to the Turkish market specifically, the indicative level has increased further to $540-550/mt FOB on June 5. “We will see if these or higher levels will be achieved. The market is not yet solid and lower levels may be there also, at least in some bookings,” a source commented.
Scrap is taken as a supportive factor, and so are the earlier closed rebar deals in the export and local markets. “By the end of last week, the level of $520-525/mt FOB [Black Sea] was not excluded as tradable. I believe this week it will be higher, taking into account that scrap is already at $380/mt CFR and above,” a trader said. However, some market players are skeptical regarding the solidity of the uptrend, thinking that scrap may only touch $400/mt CFR and estimating the state of the demand for longs as being insufficient. Generally, the limited demand for longs is seen as a major negative factor and buyers are trying to evaluate their prospects and also the market sentiment in China.