Import billet availability has increased lately due to the recent export tender by an Algerian mill which sold around 90,000 mt to several traders at $500-505/mt FOB depending on the grade, sources say. As a result, also given the weak billet and rebar demand in Turkey, some Turkish buyers managed to push for discounts, particularly for Algerian and Asian position cargoes.
According to market information, an Izmir region-based Turkish producer has booked 30,000 mt of billet from Algeria at $526/mt CFR for June shipment. More cargoes of the same origin are still available in the market for purchase, but sources believe higher levels than the one in the mentioned deal would be hard to achieve.
Another cargo of 50,000 mt of Indonesian billet is reported to have been sold at $528/mt CFR Izmir last week. Though this information has not been confirmed by the buyer, many sources believe the deal was in fact done. This price is considered to be relatively low as most previous offers for Indonesian origin are now below $533-535/mt CFR. “The Algerian [billet] price is killing the market. Now nothing above $530/mt CFR will work,” a Turkish source said. The material in this deal was bought in position by a trader some time ago when deals were done at $490-493/mt FOB, and another advantage is the relatively low freight found for this large cargo, according to market sources.
As for today’s positions of Asian exporting mills, the official offer has not changed from Friday, still at $500/mt FOB, and “it is negotiable”, a major Chinese trader said, confirming that the last sale by the Indonesian mill was done at $495/mt FOB in the second half of last week.
As the mood in Turkey’s import market has worsened lately, ex-Russia billet sellers are also under pressure. In particular, the current tradable level for ex-Russia billet with shipment at the end of June and later to Turkey is assessed at $510-515/mt CFR, translating to $490-495/mt FOB Black Sea.
Many report the number of buyers in Turkey’s import market is limited, given the low domestic and export demand for longs. The mentioned imports of 80,000 mt of billet were bought by a large producer which also has flats production. Therefore, its billet purchases are justified by its aim to shift crude steel output to slabs. “The captive billet cost [in Turkey] I feel is around $530-535/mt and slab cost is around $545-550/mt,” a trader said. The latest import slab offers of non-toxic origins have been at around $545-555/mt CFR, versus much cheaper billet options.
