Rebar still strong in N. Europe & CIS, but loses steam in Mediterranean

The Mediterranean rebar markets which had indicated a flat movement in early October started to slow down this week. Despite the decreases in the Russian domestic market, the CIS still stands out as the strongest market. Turkish domestic rebar prices – especially in the Izmir area - have decreased on a TRY basis. The 12 mm rebar price in Izmir fell to TRY 905-915/mt ($516-522/mt+VAT). Although the mills' list prices have held on to TRY 950/mt in the Marmara region, discounts have been heard of for big tonnages. The 12 mm rebar price in Turkey's Southern region was at TRY 915/mt ($519/mt+VAT). After some sales were concluded at TRY 905/mt in Turkey's Sivas area at the start of the week, towards the end of the week sales were concluded at TRY 910/mt ($519/mt+VAT). In spite of the decreases recorded on a TRY basis, the appreciation of the TRY against the US Dollar has prevented prices from decreasing significantly on a US Dollar basis. Turkish rebar exports have decreased slightly to $510-520/mt FOB for December shipments. Turkish producers have not been in an aggressive mood for export sales for almost one month now. Those Turkish producers that concluded sales in early September to Eastern Europe and the Middle East at increased prices (especially in the UAE), experienced stagnation in exports during mid-September due to the huge domestic prices increases. Turkish producers have not been complaining about this situation since domestically demand and prices were strong. However, with regression in domestic demand and prices, export offers are starting to record decreases as well. These decreases may continue, but only slightly until the UAE and US enter the market for December shipments. If the UAE and the US conclude huge tonnage purchases for December shipments, prices may become flat or even rally in late October / early November. Demand and prices are in a downward trend in Eastern Europe. Meanwhile, Spanish producers have reduced their base rebar prices by Euro 20/mt in their domestic market. AENOR-certified 12 mm rebar base prices fell to Euro 530/mt ex-works on a 60-day deferred payment basis. Imported rebar price levels in the Spanish market are at Euro 460-485/mt free on truck. The market seemed to lose its steam in September and some market players are expecting prices to decline further. The situation in Portugal is similar to that in Spain. Prices in Italy remained almost unchanged at Euro 445-450/mt ex-works. With Ukrainian rebar producers focusing on the Russian market, the Italians had less competition in North Africa. Despite the slowdown in Eastern Europe, this situation may support prices in Italy. Furthermore, the softening in the Euro/US Dollar exchange rate, which creates a bottleneck situation for rebar imports to Southern Europe, also has its advantages, especially for the Italian producers' rebar exports to North Africa. Rebar prices in the Israeli market were at $540-550/mt ex-works at the beginning of the week. Demand is not strong in the domestic market which shows a downward trend. The UAE market indicates a flat movement. Importers are not showing much interest in the Turkish offer levels of $520/mt on a theoretical weight basis. Buyers are planning for lower levels for December shipments after the month of Ramadan. A directly contrasting market trend to that in the Mediterranean dominates in North Africa and the CIS. Meanwhile, despite the approaching winter season, the German market still seems strong. Rebar ex-Latvia has been booked in Germany at around Euro 450/mt DAF on actual weight basis. Russian domestic market prices have started to slow down, but only slightly. However, these decreases have not affected the market as the prices are very high. Due to their domestic market situation, Russian producers are not taking into consideration Iranian offers of $510-520/mt CFR Iran (Caspian Sea ports). Ukrainian mills - especially Mittal Steel Kriviy Rih – have focused on the Russian market. Reports state that Mittal Steel Kriviy Rih has raised its rebar price to $500/mt FOB Black Sea. Some market players consider that these prices may constitute the peak point as the construction season comes to an end.