Ex-CIS billet prices have increased by $5/mt over the past week to $425-430/mt FOB, following the rises recorded in global scrap and iron ore quotations. Meanwhile, SteelOrbis has been informed that firm bids slightly lower than the level of $425/mt FOB may be accepted by sellers for large volumes.
Turkish merchant bar producers needed to buy billet after the sales they concluded to North Africa as of mid-June. With the billet sales opened by Turkish producer Kardemir early today, July 4, which was closed after selling about 95,650 mt in total, Turkish buyers - particularly rolling mills producing merchant bar - seem to have procured most of their needs. As a result, Turkish buyers are expected to adopt a cautious stance as regards ex-CIS billet offers at $440-445/mt CFR Turkey.
Meanwhile, it is heard that buyers in the North Africa have mostly completed their billet purchases for July and August, and so demand in the region is at low levels. However, an Egyptian administrative court has suspended the country’s preliminary safeguard duties on billet and rebar imports which were 15 and 25 percent, respectively. With this decision, Egypt has once again become a target market for CIS-based billet suppliers. Having increased their export offers to $440-445/mt FOB in the current week, the market is waiting to see Turkish mills’ future price strategy which would enable them to compete with CIS-based billet mills in Egypt. On the other hand, market sources state that Egyptian buyers’ main criterion for billet imports will be price. SteelOrbis has been informed that a UAE-based trader has concluded a sale to Egypt since the court announced its decision. However, market sources believe that producers on Turkey’s southern coast will hold the advantages of freight cost and rapid shipment as compared to CIS-based mills, while they think Egyptian rolling mills may purchase billet for September deliveries as they will seek to anticipate any possible revival of the safeguard measures. Under the current circumstances, ex-CIS billet suppliers are not optimistic about their sales to Egypt, report market sources, but they think this development will at least push up billet quotations with the support of higher scrap prices.