Trading activity has remained quiet in the Turkish billet market. While some local buyers and foreign sellers have been waiting for Kardemir to announce its new price, others have been trying to evaluate the effects of Russia's recently imposed export duty. As a result, some deals have been closed only for local origin billet, in the Iskenderun region specifically.
According to sources, one of the Iskenderun region-based mills has traded two medium-sized lots this week at $686/mt and $688/mt ex-works, with the current offers mainly heard at $690-695/mt ex-works. Moreover, today, the producer has already sold 10,000 mt of billet at $692/mt ex-works. In the Izmir region, the offer level is similar, while in the Marmara region one buyer received an offer at $685/mt ex-works early this week. Kardemir was expected to announce its sales today, with expectations varying from $650-655/mt to $670-675/mt ex-works. Still, the producer is out of the market for now.
In the import segment, a large amount of uncertainty prevails after Russia’s imposition of export duty. Most Russian mills are still evaluating the new conditions with the new 15 percent export duty (not less than $115/mt) to be paid for billet shipments from August 1. But one or two small lots of ex-Russia billet for prompt shipment are heard to have been sold at $630/mt FOB, according to sources. “Demand [for ex-CIS billet] is very weak now. But offers are also rare,” a trader told SteelOrbis.
The price indication for ex-CIS billet to the Middle East has been heard at $700/mt CFR, which with the highest freight rate may come down to $640/mt on FOB Black Sea basis. The SteelOrbis reference price for ex-CIS billet is still at $625-635/mt FOB due to limited demand, though bids have come down to $620-625/mt FOB at a maximum.
In Turkey, offers have been mainly reported at $670-685/mt CFR, up $5/mt over the week. Bids, however, have not improved much since last week and remain at $640-655/mt CFR in the northern and Marmara regions. However, a deal from the CIS to Turkey has been reported for 20,000 mt at $675/mt CFR for base wire rod grade. Some of the small EAF-based Russian producers have naturally taken a step back to evaluate the market. “With our costs we cannot absorb the $115/mt duty, so sorting out the issue is not easy,” a mill commented.