Ex-US scrap prices in particular have this week been increasing in line with the strong scrap demand coming from the Middle East and the continued scrap demand from Turkey. Billet prices (and consequently finished steel prices) have this week maintained their uptrend against the background of the rising scrap prices. While Turkish producers are having difficulties in gaining acceptance in the export markets for the wire rod price level of $500/mt FOB, they are faced with the same difficulties as regards their rebar prices, which are at similar levels to their wire rod prices.
It is heard that Turkish producers have this week concluded some billet deals to the Arabian Peninsula at $425-430/mt FOB. On the other hand, while billet prices are at $440-450/mt ex-works excluding VAT in the local Turkish market, these levels are considered to be on the high side.
Meanwhile, ex-CIS billet offers have been heard at $125-430/mt FOB this week. These prices seem acceptable for wire rod production in particular, though the length of lead times is causing some difficulties.
It is expected that billet prices will remain on their rising trend if scrap prices also maintain their strength. However, finished steel demand looks increasingly likely to register a downward movement as Ramadan gets closer. In the coming period it will be seen with greater clarity what influence Ramadan will have on billet prices, which may be caught in the near future between lack of demand and strong scrap prices.