Supported by the positive situation in China and the increased workable billet price levels in Asia, the indications in the Turkish market have also started to climb. The severe devaluation of the lira not only weighs heavily on the domestic rebar trade in Turkey, given problems with cash and credit availability for financing deals, but also significantly complicates import billet negotiations. Another obstacle is the export license issue, which limits importers’ flexibility regarding billet delivery terms.
In Turkey, billet offers from Russia and Donbass have climbed this week, inspired by the positive situation in China. The most recent targets have been voiced at $550-555/mt CFR, versus workable levels of around $540-545/mt CFR confirmed in deals last week. Still, most market players believe that the price increase will be hard to achieve, particularly for larger volumes. “Only small lots can be booked at slightly higher levels than last week and by those who are in urgent need. For others, ex-Asia offers are not that far away pricewise,” one trader told SteelOrbis. Indeed, the Malaysian indications are mainly at $555-565/mt CFR, up from $540-545/mt CFR in deals last week. Indonesia and China are both in the market with $550/mt CFR, sources report. The same price level was fixed in a second deal for up to 15,000 mt of billet from Ukraine closed at the end of last week following the previous slightly lower-priced transaction.
As a result, despite slightly positive sentiment, the SteelOrbis daily reference price for ex-Russia billet has remained stable at $515-520/mt FOB, as the targeted price increase is still considered to be not acceptable by Turkish buyers.
In the Turkish domestic market, the general billet price idea from the mills has remained stable over the past week at around $600-605/mt ex-works in the Iskenderun and Izmir regions and at $610/mt CPT Marmara. Since the rebar business has been severely affected by the ongoing rapid currency devaluation, interest in domestic billet in currently low in Turkey.
