Turkish longs producers have been attempting to increase prices this week in both export and domestic markets, but the uptrend is mainly supported by the factors other than demand, which has remained weak. One of the main reasons is the impact of the war in the Middle East, triggered by US-Israeli strikes on Iran, which, amid many consequences, has immediately led to a jump in oil and gas prices. Consequently, there has been a significant rise in international freight rates for maritime operations, supported also by higher risks associated with passing through Red Sea, not even mentioning the situation in the Strait of Hormuz. In such conditions, import scrap prices, which are already high and firm, are not likely to roll back in the near future. In addition, import billet prices have increased compared to last week, also theoretically giving a push to Turkey’s production costs.
In the meantime, the demand side has remained extremely quiet for exports, while in the domestic market, where before the outbreak of the war a certain upturn in demand was anticipated, restocking has remained slow. Sources expect that, in such unstable conditions, some buyers may postpone purchases until they see a clearer picture. However, some may choose the opposite course in order to have stocks for the post-Ramadan period. Overall, the price uptrend in the local market is driven more by costs and expectations, rather than supported by demand.
In the domestic market, most Marmara-based mills are offering rebar officially at $565/mt ex-works, while Izmir region-based producers' official rebar prices are available at around $550/mt ex-works, both up $5/mt over the past week. One Iskenderun region-based mill has been offering rebar at around TRY 29,300/mt ($555/mt) ex-works this afternoon, up rebar price by TRY 500/mt ($8/mt) week on week. The Iskenderun region is closer to the war zone, so the increase in rebar prices in this region is higher than in the rest of the country. The overall workable rebar prices for sizeable tonnages and cash payment have settled this week at $545-560/mt ex-works, up by $5/mt.
Turkish official rebar export prices are available at $550-570/mt FOB for late March-early April shipments, up by $10/mt amid costlier freight rates and war-related risks. However, the higher end seems a bit on the high side under the current market conditions.
In the wire rod segment, official domestic prices in Turkey have settled at $560-575/mt ex-works, versus $550-570/mt ex-works last week, depending on the region. As regards exports, Turkish mills are also testing $560-580/mt FOB for wire rod, versus $555-575/mt FOB last week for cargoes for March and April shipments. The workable wire rod export price is evaluated at $555-570/mt FOB, up by $5/mt over the same period.
.jpeg)