Prices for ex-Russia billet have not changed much this week mainly due to the absence of Turkish buyers for the holidays. However, as the exchange rate of ruble against dollar has come to below 85 mark this week, making exports less attractive, some exporters have been holding back, hoping to push prices slightly up in the near future.
The SteelOrbis reference price for ex-Russia billet has remained at $498-500/mt FOB Black Sea, unmoved over the week, while offers have been rarely heard at near $505/mt FOB.
The latest deals and tradable level for ex-Russia billet to Turkey have been at $515-520/mt CFR from early June. Offers have been at $520-525/mt CFR for late July-August shipment and bids before holidays from buyers in the Turkish Black Sea were at $510-515/mt CFR. Prompt shipment billet from Russia was sold at $525-526/mt CFR before the holidays. The seller is going to increase offers to $535/mt CFR for prompt shipment at least from next week to offset the appreciation of ruble. “I don’t think [Russian exporters] will manage to sell at higher levels before ruble will resume falling. At best, prices will stabilize at previous levels,” a trader said.
Also, the export duty is changing, based on the exchange rate. So, for a long time, when the ruble rate was 90 and slightly higher up to 95, the export duty was 5.5 percent, while now it slipped to 4.5 percent (for exchange rates 85-90). Over the month, the ruble exchange rate has appreciated from the peak at 91.62 on May 23 to 83.5 on June 19, according to Bloomberg. Today RUB-USD rate is 88.6.
In the Egyptian market, billet trading has been still limited by the financial restrictions, high port stocks and other factors. A deal for unknown origin billet has been heard at $535/mt CFR, almost in line with last week’s level.