Ex-Russia billet prices have dropped this week, following the significant decline in scrap prices in Turkey, the main market for Russian billet suppliers. Even though the ruble has strengthened against the dollar and exports have been less favorable, prices have not been sustained, though overall trading has remained limited.
Offers for ex-Russia billet to Turkey have been reported at $460/mt CFR Turkish Black Sea, translating to $440/mt FOB, which is a sharp fall from mills’ targeted levels of $460/mt FOB last week. Moreover, sources reported that small volumes of up to 5,000 mt would be traded at $455/mt CFR Zonguldak at present. “We assess the CIS prices based on China,” a trading source said.
Chinese offers have been at $455-462/mt CFR to Turkey depending on the trader and the port. “But there was no deal after the last one at $460/mt CFR, since, with the current scrap price, buyers may wait for even lower levels,” a Turkish source said.
At the same time, Russian billet exporters are still inactive due to the exchange rate fluctuations. In particular, this week the exchange rate has reached $1 = RUB 82 on April 17, from as high as $1 = RUB 86 last week. “With the current ruble, most [sellers] will be gone and only small volumes to traditional customers will remain to support relationships,” a selling source said.
The ex-Russia billet reference price has dropped by $12.5/mt over the past week to $435/mt FOB Black Sea.