Russian rebar producers have continued to refrain from an active presence in export markets, paying much more attention to local sales. Domestic rebar prices have been higher than export prices by at least $120/mt, a gap which has not been seen in previous periods. Moreover, Russia’s recently disclosed intention to impose a temporary export tax for steel products, which is expected to result in Russian mills’ complete absence from overseas destinations.
Domestic offers for rebar in Russia are at $854-865/mt (RUB 74,000-75,000/mt) ex-works/CPT depending on the region, relatively stable on US dollar basis over the past month. “Orders keep coming and local prices are far better than export prices, so mills are paying almost no attention to exports,” a source said. Indicative offers from the CIS are reported at $730-740/mt FOB for August shipments.
Moreover, reports of the possible imposition of the export tax for steel in Russia has made Russian mills even more reluctant to sell rebar for export, even though some buyers naturally require the consistent presence of Russian suppliers. A tax of 15 percent but no less than $115/mt is being rumored. “If they are not interested in exports now, soon Russia will not be there at all if the tax is introduced,” a Russian mill told SteelOrbis. However, in the mid-term, the local rebar price in Russia may decline as the export tax, if imposed, will reduce supply pressure.
Export wire rod prices from Russia are at $860/mt FOB, while ex-Ukraine offers have been reported at $830-840/mt FOB.