Offers prices for billets in Turkey have posted declines early this week due to the weakening in China and poor demand in major sales destinations for Asian sellers. But Turkish buyers have remained inactive in terms of purchases as they await a clearer trend in scrap and possible further declines for billets.
Chinese and Indonesian billet offers have been at $465-468/mt CFR Turkey for June shipment this week, down from $475/mt CFR seen last week. Following the significant drop in Asia over the past two weeks, some Turkish buyers have been waiting for even lower levels - around $460/mt CFR. “Scrap prices are also expected to go down,” a trader said, commenting on the continuing slowness of billet buying in Turkey.
Other Asian sellers have remained less active. After an offer of 30,000 mt of Malaysian billet at $500/mt CFR to Turkey last week, this week this origin has been indicatively priced at $480-485/mt CFR, but no firm offers at such a level have been reported so far. “This [$480-485/mt CFR] would be logical for Malaysia, but there is not much allocation. The seller can wait,” a source said.
Russian exporters have also not been very interested in exports. The local currency in Russia depreciated slightly early this week, making exports more attractive. The rate reached $1 = RUB 86.5 on Monday this week, versus $1 = RUB 84.-84.5 for most of last week. Nevertheless, this was not enough for most sellers to offer aggressively low prices, according to sources. At the moment, the tradable level for ex-Russia billet has been assessed at $470/mt CFR, versus offers at $475-480/mt CFR last week. Some suppliers still believe $475/mt CFR will be the lowest offer in the current conditions, but Turkish buyers are targeting a price for Russian material at a similar level to Chinese billet prices.
The SteelOrbis reference price for ex-Russia billet has been lowered by $5/mt to $450-455/mt FOB Black Sea.