Billet market players in Turkey are mainly trying to evaluate the actual impacts of the situation in the Middle East and in the Red Sea on shipments and deliveries, while international traders have been mainly dealing with surging freight rates and revised import offers, among many other issues in terms of ongoing discharges. Most import biller prices in Turkey have increased over the past week, but the levels remain indicative and are considered more of a market marker than as actual offers. In Turkey, rebar prices have increased by $5/mt over the past week to $555-575/mt ex-works and up to $580/mt ex-works in the Marmara region, but the new levels are not yet supported by demand as buyers are cautious on restocking for now.
Currently, ex-China offers in the Turkish market at estimated at $500-510/mt CFR for May shipments, up from the most recent sale at $490/mt CFR closed last week for a regular 50,000 mt lot. Ex-China billet offers on FOB basis have posted a very limited increase, by $5/mt to $450-455/mt FOB, and they may be stable in the near future if the local market does not post any faster improvement. But with freight rates to Turkey increasing to $50-55/mt at the lowest, “Turkish customers will avoid buying from China,” one source said.
Ex-Malaysia indications have been reported at $510/mt CFR from one trader, again for May shipment, up $5-10/mt over the past week. Indonesian billet is now offered at $480/mt FOB, which would be closer to $535/mt CFR Turkey, which is obviously not workable. The Ukrainian mill has decreased its offer by $5/mt over the past week to $525/mt CFR for April shipments, while some bids have been heard at levels $20-25/mt lower.
The SteelOrbis reference price for ex-Russia billet has remained stable at $440/mt FOB Black Sea on average. But, for Turkish buyers, offers have edged up due to increasing freight. In particular, small lots of 3,000 mt of ex-Russia billet have been available at $470/mt CFR Zonguldak, while some Russian sellers may target $475/mt CFR in the near future, expecting that Turkish buyers will have a lack of cheaper alternatives. “Turkish buyers are resisting accepting an increase in CFR prices,” a trader, dealing with Russian billet sales, said.
Nevertheless, some acceptance of higher Russian prices in Turkey is expected due to the excessively high ex-Asia prices. “For most Turkish mills, the focus will be on alternative billet origins - the Russian Federation or Ukraine and Algeria,” a trader said.
In the Turkish domestic market, many mills are not seeing themselves in a position to actively offer billets since the workable prices are still below their costs. While captive billet production costs remain roughly at $520/mt, offers in the Iskenderun region stand at $508-515/mt ex-works this week and only a few were aiming at $520/mt ex-works in line with the previous sales by the same supplier. In the Izmir region, the billet prices are assessed at $510-515/mt ex-works, up by around $5/mt over the past two weeks.
