In line with the high-flying semi-finished product prices, the merchant bar prices in southern Europe have been maintaining their strength. Although the merchant bar demand level in the Middle East has been strong (just like demand in the region for other long products), the Turkish and European producers are having difficulties in offering to the Middle East, particularly to Dubai and its neighboring region, due to the strong competition. It is heard that, despite the export duties, the Chinese producers have been able to offer merchant bars to the Middle East at levels lower than the offers of the Turkish and European producers. Exporting intensively to North and South America in addition to the Middle East, the Turkish and European producers have almost filled their July orders. The Turkish rolling mills are currently offering angles for export at $1,280-1,300/mt FOB on actual weight basis for July-August shipments. In addition, flat bars are being offered by the Turkish mills at $1,290-1,310/mt FOB, 80-100-120 mm IPE is being offered at $1,350-1,360/mt FOB, IPN-UPN are being offered at $1,290-1,310/mt FOB and 80-100-120 mm IPE AA is being offered at $1,360-1,370/mt - all on actual weight basis and also for July-August shipments.
Looking at the local Turkish merchant bar market, hard times are still being observed as regards end-user demand. The price level of merchant bars of 140 mm and below ranges between TRY 1,600/mt ($1,290/mt) and TRY 1,650/mt ($1,331/mt) ex-works, on actual weight basis and excluding VAT, in the market in question. It is heard that the traders who had previously taken position have been offering at price levels lower than the abovementioned range. It is known that some Turkish and European rolling mills have started running single shifts or have suspended work entirely. The mills in question, which do not have electric arc furnaces or induction furnaces, have started to cut back on their production given the difficulties they have been experiencing in billet supplies on account of the prices increases of this material caused by rising raw material costs. In addition, the end-users who have been working on a project basis have been continuing to bide their time if they are under no contractual obligation to continue work. The rolling mills and end-users both in Europe and Turkey, which have been having difficulties in purchasing semis and long products in their own domestic markets due to the high price levels, are wondering how long and how far these prices will go up in their domestic markets. The domestic market prices in exporting countries in southern Europe, such as Italy and Spain, have been increasing due to the strong export situation. While it is observed that base prices in Italy and Spain are on the rise, no signs of revival in demand levels have been seen in these countries' domestic markets yet.
North and West Africa are still attractive markets for producers in southern Europe. These producers have been keeping their Turkish and Chinese competitors out of the market in Algeria - a country which implements an import duty on long product imports arriving from non-EU countries. Therefore, North Africa (and Algeria in particular) has become the ideal export market for the southern European countries.