Domestic billet prices in Turkey have been relatively stable over the past week with some inclination to move up, supported by solid scrap pricing, while rebar demand has been providing milder support. Chinese billet suppliers have returned from their holiday with a considerable price increase, which, according to Turkish buyers, may not be sustained and so buyers are taking their time before starting negotiations.
The latest import scrap price increase, accepted by the Turkish mills at the end of April, has not quite been reflected in domestic rebar prices due to insufficient demand. In fact, Turkish suppliers generally stepped back by at least $5/mt to $590-615/mt ex-works in official offers, while the workable levels are not over $605/mt ex-works. Local billet prices stand at $555-565/mt ex-works mainly, specifically in the Iskenderun region, with some negotiations taking place. One of the mills in the Izmir region, however, is aiming for $580-585/mt ex-works, which is not considered workable at the moment. Last week, offers for billet stood at $550-555/mt ex-works and up to $560-565/mt ex-works from some suppliers, though the latter level was not considered workable.
Currently, ex-China billet offers for end-of-June and July shipments are mainly at $535-537/mt CFR depending on the supplier, up from around $520-525/mt CFR early last week. Considering the long lead time and the rather sharp increase, Turkish mills are not in a rush to book and, according to sources, the workable level may be closer to $520/mt CFR and slightly above. “In the current market, I don’t think there will be any additional demand for import billet. Just the regular customers will be in the market,” a source told SteelOrbis.
No fresh offers from Malaysia have been heard following the $533/mt CFR Iskenderun deal reported last week, while the ex-Indonesia price is at $490/mt FOB for end-of-August shipment, which is evaluated at not less than $540-545/mt CFR according to today’s freight rates. Ukraine, having a limited allocation, prefers to focus on the higher paying EU markets. The Ukrainian indication for Turkish buyers is at $580/mt CFR for June shipments, which is definitely not workable under current conditions since it exceeds the domestic price by at least $15-20/mt.
Import billet indications from Russia and Donbass have been reported at $510-515/mt CFR, mainly for shipments in the first half of June. The lower end of the range is considered quite workable for small lots for prompt shipment. According to sources, around 20,000 mt have recently been booked from Russia at $508/mt CFR Marmara region. The SteelOrbis daily reference price for ex-Russia billet to be shipped from the Black Sea is now set at $480-485/mt FOB, up $2.5/mt on average over the past week.
