Merchant bar prices have this week been maintaining their strong situation in southern Europe, mainly due to the strength of billet prices. However, the high levels of billet prices have been complicating life for the merchant bar producers. Traditionally, compared to rebar, increases in billet prices are reflected on to merchant bars later. With the increased prices currently having being passed on to merchant bars and the prices of the latter starting to approach the billet price levels, rolling mills have been experiencing difficulties in offering at certain price levels and in explaining the situation to end-users. Due to the high price levels in the local Turkish market, producers have been facing greater trouble in selling material and some rolling mills have been slowing down their production. The merchant bar prices in the local Turkish market are in the range of TRY 1,620-1,740 TRY/mt ($1,317-1,415/mt) excluding VAT. It is heard that some traders with previously-taken positions have been offering at lower price levels.
The tough situation in the local Turkish merchant bar market also exists on the export side. It is heard that Chinese producers have been making offers to the Middle East at lower price levels compared with the Turkish prices, in spite of the 15 percent export duty. This situation has been causing some grief for Turkish producers in this market. Depending on the region, Turkish rolling mills are offering angles at $1,380-1,400/mt FOB on actual weight basis for August shipments. In addition, flat bars are being offered by the Turkish producers at $1,390-1,410/mt FOB, 80-100-120 mm IPE is being offered at $1,440-1,450/mt FOB, IPN-UPN are being offered at $1,410-1,430/mt FOB and 80-100-120 mm IPE AA is being offered at $1,440-1,450/mt FOB - all on actual weight basis and also for August shipments.
Looking at the local Italian and Spanish merchant bar markets, it is observed that no great change has been seen in the base prices. Demand for merchant bars has been growing in Eastern European countries; however, it is observed that the Italian producers have not been having an easy time in performing exports to the countries in question.