Turkish producers continue to cut their longs export prices amid the negative sentiment in the import scrap and billet segments, coupled with the sluggish international demand. "Firm bid prices may be further discussed depending on the tonnage. The main issue is there are no [export] inquiries on the table," a source told SteelOrbis. In addition, local Turkish demand is not sufficient enough in order to balance the slow trading activity in the export segment. Most domestic buyers are taking their time to conclude new purchases and prefer to monitor possible bottom price levels. Another issue is that local construction activity has slowed down somewhat due to the Ramadan period.
Another issue is that buyers foresee lower workable prices generally for finished steel in Turkey and for longs in particular. The Turkish government has announced a 15 percent discount on electricity prices for industrial usage and a 20 percent discount on natural gas prices, to be effective from April 1. This policy will support the mills in reducing their production costs and in being more flexible in their product pricing while still preserving a decent margin.
Currently, ex-Turkey rebar offers are standing at $710-720/mt FOB for April shipment, falling by $10/mt over the past week. In the local Turkish rebar market, most mills in the Marmara and Izmir regions are officially offering rebar prices at $730-740/mt ex-works, while additional discounts are applicable for serious buyers only. Around 10,000-20,000 mt of rebar were traded at $715/mt ex-works in the Izmir region yesterday, March 28, SteelOrbis has learned.
In the wire rod segment, the export offer level for April shipments is at $720-730/mt FOB versus $740/mt FOB seen a week ago. Slightly lower levels are on the table depending on the sales destinations and quantities. Export wire rod demand is sluggish amid the ongoing unclear financial situation in the EU, the unrest in Israel and the silence in the Middle Eastern markets due to Ramadan. In addition, there is competition with the Egyptian mills, which are offering wire rod in the Mediterranean region at $690-700/mt FOB, but for May shipments.