For weeks, the high levels of finished steel prices were based on strong scrap prices, despite weak end-user demand. Following the slowdown in the scrap markets, particularly after Turkish steel producers' withdrawal from the scrap market, demand for semi-finished steel products and for long steel products became rather muted. Nevertheless, steel billet and finished steel product prices remained at high levels. However, this week demand has declined further and steel billet booking activity has nearly ground to a halt.
After reaching $680-685/mt FOB last week, Turkish steelmakers' steel billet export offers have dropped to $665-670/mt FOB this week. Meanwhile, steel billet import offers to the Turkish steel market indicate some variation. Some steel billet import offers for Turkey have been at $665-680/mt CFR this week; however, with some lower offers heard in the market, buyers have preferred to wait and monitor the market, instead of making purchases amid the current uncertain market conditions.
This week, steel billet offers of the CIS steel producers have remained at $650-680/mt FOB, indicating no change as compared to last week. While some steelmakers in the region have not actively given steel billet export offers due to their shortage of material for February production, existing export offers have remained unchanged, since producers are waiting for clarification of the situation in the scrap market in the coming weeks. In the meantime, ex-CIS steel billet offers to the Far East have increased to $680-690/mt CFR. However, due to the availability of lower steel billet prices from regional stockists, local rolling mills are not showing much interest in these import billet offers.
The steel billet markets are expected to gain clearer shape after the readjustment of scrap prices following anticipated scrap bookings.