Following the recent gradual decline in scrap prices, a number of billet importers from Turkey have lowered their price ideas too, while Egyptian billet customers have taken a wait-and-see position due to sharp currency fluctuations. As a result, ex-Black Sea billet prices have gone down, even though a number of sellers are still insisting on high prices.
According to market sources, offers from a number of Russian steel producers have been at $523-527/mt FOB Black Sea this week. Last week, the producers’ targeted level was $525-540/mt FOB in general and even higher from one mill. “Now, the market is stuck. Offers are high, while bids are low, so we are not buying anything and not selling either. We are focused on old contract commitments, which are scheduled up to mid-March,” a trader, dealing with ex-CIS billets, said. Another trader has assessed the workable price in the market as being at $518-520/mt FOB Black Sea, which is somewhere in the middle between the current offers and deals.
The support seen last week from the Egyptian market has faded away. The sharp fluctuations in the unofficial rates of the local currency in Egypt has led to a drop in domestic steel prices this week, and most market sources see imports as very risky now. Offers from traders, who took positions earlier at higher levels, have been voiced at $565-575/mt CFR. But bids have dropped again by $10/mt over the past week to $550-555/mt CFR at the highest, which is in line with the contracts signed in the import market before the hike seen last week.
In Turkey, there has been barely any offer available this week, partly due to the mood shifting in the Egyptian market. The indications for ex-Russia and ex-Donbass billet have been pulled back by $5/mt to $545-550/mt CFR, while slightly higher offers might still be available. Most market players reported there are not many offers from Asia, mainly due to the holiday in China and stalled demand, while the evaluations are at $560-565/mt CFR for the main origins. “They [suppliers of Asian billet] are not pushing anyone and also there are not many takers due to previous restocking,” a market source told SteelOrbis. In addition, there are offers from Iran at around $525-530/mt DAP Karabuk, but the price idea from buyers is at least $10/mt lower.
The SteelOrbis reference price for ex-Black Sea billet has settled at $515-523/mt FOB, with the midpoint at $519/mt FOB, down $6/mt from yesterday and down $11/mt over the past week.