Ex-Ukraine billet volumes are out of the market as the major exporter Metinvest has announced force majeure and another major mill AMKR has been forced to halt a blast furnace, while all ports have been blocked by the Russian invasion. At the same time, exports from Russia have also been halted and it is unlikely to resume in the near future while the war is continuing, most market sources believe. In such conditions, the import market for billet in the MENA region is in chaos and prices have been rising consistently amid critical shortages.
In Turkey, after local billet prices reached $780-785/mt ex-works and $810-815/mt delivered in some regions, which was reported earlier this week, a deal for 10,000 mt of local billets has been signed at $800/mt ex-works just lately.
The import market in Turkey is chaotic. Buyers and traders are trying to rearrange their trade flows, given the absence of volumes from Ukraine and Russia. The main alternative source is Asia, in particular India, Indonesia, Vietnam, Malaysia. Price indications are reported at around $800-815/mt CFR, while some said ex-India indications are at $750-760/mt CFR. “Today, no price is set and offers are made only according to traders’ personal evaluations. But definitely the market is heading to far above $800/mt CFR over here,” a source told SteelOrbis.
Turkey has been sharply increasing export prices for billets in the current conditions. Offers have been heard at $800/mt FOB from some sources, versus deals done at $720-725/mt FOB late last week. Moreover, some people have said that at least one mill has been asking for $830/mt FOB for April shipment and $850/mt FOB for May shipment though these levels are just a reflection of the chaos in the market, sources said, not the reality.
Traders have been offering ex-Turkey billet, which they took at a position last week at $790/mt CFR to Egypt this week, but no deals have been heard as buyers are cautious and they are trying to evaluate the losses of volumes on previous contracts and the future payments. Last week, a deal for import billet to Egypt was at $725/mt CFR last week.
“It’s the end of exports from Russia,” a trader said about the possibilities of shipping or buying ex-Russia billet in the near future. Even taking into account that big Russian mills have offices in Switzerland, banks have started to say (even though official notice) that they are not supporting export deals from Russia. “Of course, eventually a way will be found. But not right now. Not during the war,” he added. Moreover, with the latest European sanctions on Novorossiysk Commercial Sea Port, the shipments of already booked material are also a source of great concern.
In the current extraordinary circumstances, SteelOrbis will temporarily suspend its daily ex-CIS billet price.