Trade in Turkey’s billet market has been rather slow following the recent holiday, while prices have mostly stabilized. Market sentiment is generally weak as rebar sales in both the domestic and export segments are still insufficient. As a result, local demand for billet has been on the quiet side, while in the import segment there are basically two origins available - China and Russia. Preference may be given to the latter by small and medium-sized buyers due to the advantage of short lead times.
Local billet prices are mainly at $560-565/mt ex-works in the Izmir and Iskenderun regions while $555/mt ex-works may be achievable for a good tonnage. Still, suppliers report that buyers are rather quiet and that their price ideas are at $550/mt ex-works and lower. In the rebar segment, the mills are trying to settle at $595-620/mt ex-works depending on the region, but sales volumes remain generally at moderate levels. Sources report that seasonally demand from construction is expected to decline especially in touristic areas and basically no significant improvement in sales is expected in the coming weeks.
Ex-China billet offers for end-of-July and mainly August shipments have settled at $525-530/mt CFR, in line with the pre-holiday levels. Buyers are expected to seek deals closer to $515/mt CFR, but not much extra activity is expected even if this level is achieved. The main reason is the long lead time with delivery in September, and buyers are finding it hard to evaluate the longs market situation over that period of time. “It is better for the mills to concentrate on scrap purchases now for end-of-June and July shipments. For billet, maybe the regular buyers will book to keep up a sustainable billet inflow,” a source told SteelOrbis. Both Indonesia and Malaysia are currently out of the market, while Ukraine has preferred to trade its limited allocation to European countries, while its prices are quite a bit higher than those achievable in Turkey.
The SteelOrbis reference price for ex-Russia billet has been at $485-490/mt FOB Black Sea, inching up by $2.5/mt on average over the past fortnight. The latest deal was done at $510/mt CFR Turkish Black Sea “on the eve of the Eid”, a market source said. This price translates to around $485-486/mt on FOB basis, and signals that in general the market is stable with moderate demand persisting before the holidays. This week, offers have been at $515/mt CFR, but no new deals have been reported so far. To North Africa, Russian billet exporters are targeting $490-495/mt FOB.
