According to market sources, Turkish producers'
rebar offers to the export markets have continued their gradual downtrend, softening by $5/mt over the past week to the range of $560-570/mt FOB. It is getting harder for Turkish producers to compete in the export markets given the strong cost advantage of the Chinese producers - whose production is mainly iron ore-based - amid the current low levels of iron ore prices.
Recently, the UAE replaced Iraq as the most important export market for Turkish producers. With the UAE buyers beginning to purchase
rebar from China, Turkish producers are expected to lower their
rebar export offers further. On the other hand, Egyptian importers have been seeking price levels at around $555/mt FOB for Turkish
rebar, while Yemeni buyers have postponed their purchases due to political tensions in their country. It is getting harder to hear positive developments for Turkish
rebar exporters in these destinations.
Over the past week, import scrap offers to
Turkey have decreased below $370/mt CFR and are expected to continue their declining trend, creating expectations that Turkish
rebar prices will be revised accordingly.
In the light of all the above negative factors and with the demand situation for finished steel being more positive in the local Turkish market, Turkish producers are expected to focus on their domestic market instead of on exports in the coming period. Also, Turkish producers are likely to cut their production capacity usage rates in order to lower supply volumes and try to maintain prices at current levels.