Turkish rebar producers have this week not been so active as regards rebar export offers to the UAE. It seems that UAE importers are not in a rush to buy material since stock levels have not yet melted in their local markets, which have seen a small rise in momentum after the sluggishness observed during Ramadan. While Turkish offers to this region are currently at $485-490/mt CFR Dubai, it is known that importers expect lower price levels.
While Turkish producers are trying to insist on the price of $470/mt FOB, firm bids are lower than this. However, it is known that producers are reluctant to lower their levels before the new scrap prices are revealed. Buyers, on the other hand, are tending to push down import rebar prices since current prices are not being accepted in their local markets.
The local Turkish market has also been characterized by price decreases this week. Since the beginning of the week, price downtrends of up to TRY 30-40/mt including VAT have been observed. Demand seems pretty sluggish as end-users have been expecting further price decreases.
Meanwhile, the downtrend in rebar prices in Europe has still been in evidence, in particular in Europe's export markets. While producers do not want to make changes in their price lists for their local markets, it seems likely that prices may drop below current levels due to the general market situation. Also, strong competition is being observed among Italian, Spanish and Greek producers' export offers in the export markets which they share. The sharpest decrease in export prices is observed in prices from Italy. In general, rebar export offers given from southern Europe are currently at €330-340/mt FOB, while firm bids are at even lower levels in this region. Besides, in North Africa, which is the main rebar export market for southern Europe, so far the expected momentum has not been observed this week either.
In general, the expectations of many market players, who had previously expected or hoped that prices would acquire upward momentum after Ramadan, have been turned upside down. Having difficulties with finished steel prices, producers are hesitating to make large tonnage scrap purchases, but instead have simply been buying scrap in line with their needs for production. Due to the small tonnage scrap purchases, scrap demand is unable to exceed certain levels and so the decreases in scrap prices have continued. It seems that producers will be cautious in their scrap purchases as long as the sluggishness in finished steel sales continues; on the other hand, they will have to maintain scrap purchases in line with their needs in order to continue their production operations. All market players are watching with great interest to see how the current situation will develop in the coming period.