Billet prices in Turkey have been moving under the influence of different factors this week. Particularly, ex-China offers have increased quite significantly from the latest deal prices due to positive price trends of raw materials and futures. The suppliers of Russian and Donbass billet have been able to slightly improve deal prices to Turkey amid buyers’ requirements for prompt shipments and the bullish trend in the domestic rebar market in Turkey. However, despite rising rebar prices, general demand is still lagging behind. As a result, some domestic billet suppliers have maintained last week’s prices without any confirmed sales, while some have provided slight discounts and sold considerable volumes.
Currently, local rebar prices across Turkey have settled at $600-620/mt ex-works depending on the region, roughly up $10/mt over the past week, even though the latest workable prices have not exceeded $600-605/mt ex-works. Sources believe that mills’ price hikes in the absence of active sales are creating a bubble, which might result in them being forced to accept higher import scrap prices, which will put their margins under even more pressure. Billet prices in Turkey’s Izmir and Iskenderun regions have remained at $560-565/mt and $550-555/mt ex-works, while integrated mill Kardemir has dropped its S235JR billet offer price by $5/mt to $535/mt ex-works, while leaving its B420 price stable at $550/mt ex-works. The supplier managed to sell around 43,000 mt of billet.
Import offers from China have settled mainly at $525-530/mt CFR for June shipment by the middle of the week, up from the latest reported sales to the Izmir region at $515/mt CFR. No fresh offers for ex-Malaysia billet have been heard in Turkey, with sources reporting the earlier available cargo may have been sold at slightly below $530/mt CFR, versus $535-540/mt CFR in the initial offers. Ukraine is not so focused on the Turkish market amid better workable prices in European destinations.
A small volume deal for Russian 125 mm billet has been sold at $502-503/mt CFR Turkish Black Sea region for May shipment. There has been very limited allocation of billets with May shipment in the market, and most offers for June are at $505-510/mt CFR. There has been a rumor about a bigger volume of Russian billet sold at $505/mt CFR or above, but this information has been denied by market sources at the time of publication. “I think the $500/mt CFR mark has already been crossed in Turkey,” a trader said. Some Turkish mills still see the tradable level at $495-500/mt CFR, but, considering firm scrap and rising costs, most Russian sellers will not provide such offers. “Maybe Donbass can be sold with discounts,” a source said.
In addition, the further appreciation of the Russian ruble has added to the situation, so sellers are resisting any discounts of more than a few dollars. The exchange rate has touched $1 = RUB 75, the strongest in three years.
The SteelOrbis reference price for ex-Russia billet has settled at $470-480/mt FOB Black Sea, with the midpoint at $475/mt FOB, increasing by $5/mt over the past week.
Turkey’s export billet prices are at $550-565/mt FOB, stable over the past week, depending on the supplier and mainly for end-of-May and June shipments. Some mills are targeting sales to the EU where local prices are at €500-505/mt ex-works minimum. There have also been inquiries coming from the GCC, namely, Qatar and Saudi Arabia, but the buyers’ price ideas have been closer to the level of the indications from China - $530-535/mt CFR or a maximum of $490/mt FOB Turkey, which is definitely not workable.
