In the Turkish domestic merchant bar market prices have continued to move on a declining trend. The softening seen in raw material and billet prices as well as low demand levels and strong competition have continued to be the main reasons behind the decline observed in rebar prices. The prices of rebar decreased to the range of TRY 680-800/mt ($400-470/mt) ex-works at the end of last week, while various offer levels have continued to be heard depending on the region. Meanwhile, the fluctuations seen in the $/TRY exchange rate have also continued to be reflected in price levels. However, no improvement has been observed in terms of demand, with end-user demand remaining slack. In these days approaching spring, the construction sector in Turkey has also retained its sluggishness. Since the projects financed by the government mainly involve road works, they have hardly any impact on the local merchant bar market.
Offers given by Turkish producers for the export markets have continued to soften in line with raw material and billet prices. As an additional factor behind the softening, it is also observed that buyers have increased the frequency of counter-bids in consideration of the deterioration of billet prices. Generally, Turkish merchant bar export offers have stood at levels of $450-470/mt FOB over the past week; however, it is heard that offers have been given below these levels. As for IPE products, prices have trended in the range of $500-520/mt FOB. Scrap and billet prices as well as demand levels will continue to determine whether the price softening will continue in the coming days.
Looking at southern Europe, merchant bar producers' prices have decreased. Spanish IPN-UPN offers given to Portugal have declined to €400/mt delivered to customer. This decline has been directly reflected in the Portuguese domestic market. In Italy's domestic market, prices have also fallen down, to the range of €380-390/mt ex-works, while export offers given from Italy to Greece have deteriorated to €370/mt CIF. Despite all these price decreases, no recovery has been observed in demand levels. It is generally expected in the southern European market that the softening of merchant bar prices will continue for a while yet. Falling raw material prices, low demand and strong competition all play an active role in this situation. In the North African market in particular, Italian, Spanish and Turkish producers have continued to compete with each other.
Meanwhile, slackness has continued to be observed in the eastern European market. Eastern European countries are among those which have most felt the effects of the crisis. End-user demand in the region still trends at low levels and prices have continued to soften, on the back of the suspension of new investments.
Overall, no change has yet been observed in the European merchant bar markets, where various price offers continue to be heard, where prices show changes depending on customers, and where buyers delay their purchases as much as possible and purchase only to satisfy their needs. It is likely that only low tonnage sales will be realized in these markets for another while.