In Turkey, the workable price levels for billet have dropped significantly over the past week in both the local and import segments, despite a relative stabilization in the scrap segment. The key reason is the absence of export longs sales and the fall in rebar prices, which is the main benchmark for billet price estimations.
The domestic trading activity has been quite low except for Kardemir’s sales of 25,000 mt at $565-570/mt ex-works depending on the grade. In fact, the mill’s billet price was accepted due to the deferred payment option, while the workable level for billet in Turkey is estimated at close to $550/mt ex-works due to the rebar price fall to $600/mt ex-works at the lowest. Still, some suppliers are pursuing targets of $570-580/mt ex-works. In the Marmara region, a local supplier has been offering $575/mt CPT, SteelOrbis has learned.
In the import segment, ex-Malaysia offers are still at $540-550/mt CFR depending on the region, while the Indonesian price has slipped by $5/mt to $535-540/mt CFR. A Bahraini cargo of 20,000-30,000 mt has been offered at $540/mt CFR. Algerian billet, on offer from traders, is now at the highest level of $580/mt CFR.
Taking into account long lead times, the absence of export longs sales and the downtrend in Turkish rebar, mills are refraining from large and distant purchases. Instead, the re-rollers have shown some interest in Russian and Donbas billet and have managed to push prices down by $25/mt over the past week. The highest deals were closed at $520/mt CFR, while later on a total of 12,000 mt for immediate shipments were sold to Aliaga and the Karabuk region at $508-510/mt CFR for at sight cash payment. Following these sales, the offer levels from some traders have decreased to $505-507/mt CFR, while the level of $500/mt CFR has become more and more visible, sources estimate.
As a result, over the past week the SteelOrbis daily reference price for ex-Russia billet has dropped by $27.5/mt on average to $480-485/mt FOB.
By the end of the week, no fresh sales have been reported in the import segment, but some sources have reported bids from steel producers at $480/mt CFR and below. “They [mills] are not able to sell for export and so they are not eager to buy imports since they do not want to create turbulence in the market with their purchases,” a trader told SteelOrbis. Overall, the market sentiment is rather pessimistic and next week lower prices are anticipated.