Most market sources are waiting for an uptrend in ex-CIS billet export prices after the New Year holidays. And there are a number of factors supporting these expectations such as the positive sentiment in the scrap segment, the lack of high allocation on the mills’ side, and the expected increase in demand from Turkey and other outlets.
By the middle of this week, most large ex-CIS mills have already left the market for the holidays. The latest offers from large mills have all been above $600/mt FOB, and no one has been ready to discuss any price below this mark. While customers were bidding at $590-595/mt FOB at best last week, this week some signs of an increase in buyers’ price ideas have started to emerge.
For instance, in Turkey, where bids were very low at around $600-620/mt CFR last week, the tradable level has increased to at least $630-365/mt CFR. But for now it is just an indicative level, as the interest in import billet in Turkey is still weak and customers have been choosing to buy locally to cover short-term needs. “Turkey has lost the chance to buy [import billet] at good prices,” a mill said.
“CIS mills are claiming that they are sold out,” a trading source said.
Buyers from North Africa are also expected to resume purchases after the holidays, as they have not been able to purchase lately. The last prices discussed in Tunisia and Egypt were at $640-645/mt CFR last week, but in early January suppliers are expected to seek prices at least $10/mt higher.
Last week, a new tender for 50,000 mt of billet was issued in Saudi Arabia, but a deal has not been concluded. Mills were said to be asking for $600/mt FOB minimum, while traders have been indicating 635/mt CFR, but even this price has been high for the customer.
“In the coming 10 days, the market will be stable or range-bound [due to the holidays], but after that the uptrend will start,” a seller source said.
For now, the SteelOrbis reference price will remain at $595-600/mt FOB until suppliers manage to achieve higher prices.
