Though the recent stagnant trend in the merchant bar market still continues, to date in 2007 the merchant bar market has had an overall good year. It has been an active year so far for both small and large sizes. Large size merchant bar prices have not softened yet due to the price increase announcements for July shipments made by Arcelor and Corus. The supply of these products is limited compared with demand. Therefore, the shortfall in supply (since some mills will be in maintenance) that will be experienced for 300 mm during the summer is causing prices to remain unchanged.
Meanwhile, small size merchant bar prices have softened. Due to the Chinese export tax for these goods, merchant bar export prices increased and so demand for Chinese goods saw a decline. This situation seems to have created a difficulty for Chinese mills, which previously had an advantage with their low-priced offers.
Turkish mills' merchant bar offers for export have remained unchanged compared to last week; billet prices in Turkey are at $520/mt ex-works, excluding VAT, scrap prices are still calm and merchant bar remains stagnant. Angles are being offered at $635-650/mt FOB for August shipments while flat bars are being offered at $645-660/mt FOB, also for August shipment.
The Turkish domestic merchant bar market is also stagnant. Angle prices in the domestic market are at TRY 840-870/mt ($644/mt), flat bar prices at TRY 850-890/mt ($651-682/mt) and NPU and NPI prices at TRY 875-900/mt ($670-690/mt). All prices exclude VAT.
The merchant bar market may become active after stock levels have been reduced and when the holiday period has come to an end. Furthermore, the situation of scrap and billet prices is another factor contributing to the state of the merchant bar market.