This week, in line with the softening seen in long steel prices in the Turkish domestic market, Turkish mills have reduced their steel billet export offers by $20/mt as compared to last week to $690/mt FOB on actual weight basis. Last week's steel billet export offers at $710/mt FOB on actual weight basis failed to attract acceptance in the market and this led producers to readjust their offers. However, it is still unclear how buyers in the Middle East and North Africa will react to these new price levels.
In the meantime, with its new price list dated June 14, 2011, Turkish steel producer Kardemir has opened its sales for S235JR grade (St37) billets of 130 mm x 130 mm x 6-12 m size at the level of $683/mt ex-works, excluding VAT, and has also opened its sales for MT III-A grade billets of the same size at the level of $688/mt ex-works, excluding VAT. Compared to the previous price list, the new billet prices have decreased by $27/mt. Despite this price cut, Kardemir has not witnessed much demand and its steel billet sales are still open. In the Turkish domestic market, steel billet supply is still on the short side, while local prices stand at $680-690/mt ex-works on actual weight basis.
SteelOrbis has learned that steel producers from the CIS are currently offering July production 3SP-5SP grade steel billet to the export markets in the price range of $675-685/mt FOB, decreasing slightly by $5/mt as compared to last week due to sluggish demand, despite supply shortages. In the meantime, CIS traders' steel billet export offers still stand at $670-675/mt FOB for July shipments, and even slightly lower prices can be heard.
Although ex-Europe and ex-US scrap offers have not shown any price drop lately, the Turkish mills as well as the CIS producers and traders have corrected their steel billet offers downwards in order to find a common price level - in consideration of decreasing demand in the Middle East and North Africa due to hotter weather and also in anticipation of a further demand contraction with the approach of Ramadan. Market players are now looking forward to seeing whether these new price levels will find acceptance among buyers in the market.