Prices for ex-CIS billet have moved up further this week and though trading activity has been still not high, suppliers have been more bullish, seeing the uptrend in the scrap market in Turkey.
Offers for ex-CIS billet from mills for September-October shipment have been at $390/mt FOB minimum and some of producers from Russia have even started to voice offers at up to $410/mt FOB on Thursday, SteelOrbis has learned. Last week, realistic offers from the major sellers were at $385-390/mt FOB. A contract for 10,000 mt of Ukrainian billet from Azov Sea has been signed at $385/mt FOB for early September shipment this week. Moreover, there has been information in the market that Ukranian mill has sold a lot of billet at $395/mt FOB Black Sea, but this has not been confirmed by the time of publication, and sources believe that this contract should be on a trader rather on an end-user.
SteelOrbis reference price for ex-CIS billet from Black Sea has increased from $380-385/mt FOB to $390/mt FOB. “Srcap [in Turkey] is continuing its growth, so it is fair to offer billet at a higher level,” a source said. But a number of traders said that the workable level has not exceeded $390/mt FOB so far, taking into account still quite low bids from major destinations except Turkey.
Local billet sales in Turkey have been at $412-418/mt CFR, as reported by SteelOrbis. And demand for imported billet may increase in the Izmir region. Exporters will target $410-415/mt CFR, which translates to around $395-400/mt FOB.
At the same time, bids from North Africa have been mostly heard at $370-375/mt FOB.
There have been no reports about new sales to the GCC from the CIS over the week. Nevertheless, there have been reports that one of the customers in Saudi Arabia has bought 30,000 mt from Bahrain at estimated $423/mt CFR.
The attractivness of the Asian market has been less for the CIS mills than previously. For instance, the latest deals to the Philippines and China from India have been heard at equivalent to $420-425/mt CFR. Taking into account the freight at $40-45/mt from Black Sea, this level translates to just $380/mt FOB, which becomes too low for CIS exporters.