The domestic rebar market in Turkey remains the main driver of the increases in Turkish longs export prices, in local billet offers and in import scrap prices. As of today, December 5, the general range of local rebar prices has settled at $560-595/mt ex-works, with the lower end offered in the Iskenderun region, while the highest prices belong to the Marmara region-based mills. Although buyers are currently somewhat cautious regarding restocking, the market situation is generally evaluated as being positive.
Based on higher rebar prices, domestic billet offers in Turkey have also increased. Last week, the general level of offers stood at $510-520/mt ex-works depending on the region, while Kardemir traded over 50,000 mt at $515/mt and $525/mt ex-works. This week, offers in the Marmara region are as high as $530/mt delivered, while in the Iskenderun region, where rebar prices are lower, they stand at $515-520/mt ex-works. Suppliers in the Izmir region, according to sources, are offering at $515/mt ex-works.
By the end of the week, import billet offers from China have settled at $472-475/mt CFR, up from $465-470/mt CFR seen earlier. Most cargoes are offered for shipment in the first half of February. Turkish mills do not seem much interested in large volumes of billet imports, considering the weakness of longs exports, contrary to lively and high-priced domestic sales. “With the current scrap prices, the cost of billet production in Turkey is $520/mt minimum, but that is for January-February output. Import billet from China will be delivered in March in the best case,” a source told SteelOrbis.
Billet offers from Indonesia and Malaysia are indicative at $475-477/mt and $490-495/mt CFR for March and February shipments, respectively. No negotiations have been reported. In the meantime, Ukraine is expected to have a higher chance of selling billet to Turkey since the delivery is shorter. One Ukrainian mill is offering at $500/mt CFR for February shipment, up $10/mt from last week’s offers. Another Ukrainian mill has been offering at $498/mt CFR for shipment in January. However, some buyers are aiming to obtain at least $15/mt lower.
Currently, no solid offers are heard from suppliers from Russia and Donbass, while a few buyers reported that some sellers voiced $460/mt CFR as an indicative price. The level of $455/mt CFR is still expected to be reachable by customers, based on the previous sales closed at this level. “Rebar is at $590/mt ex-works in some targets in Turkey. It makes a huge difference with the current import billet prices,” a potential billet buyer told SteelOrbis.
The SteelOrbis reference price for ex-Russia billet stands at $440/mt FOB, moving up by $2.5/mt on average over the past week. Offers can be voiced at a higher level as well, but no new deals have been reported so far. “Scrap in Turkey is moving up, but as longs exports remain weak, there is no demand for import billet [not duty-free],” a trader said. Moreover, offer volumes from Russia are limited because of the appreciation of the ruble. “With the exchange rate of the ruble at 75, there is no point in offering billet in the export market,” a supplier said.