Demand for CIS flats keeps strengthening. While a week ago mainly South American and South European buyers were interested in the material, by now Turkish and Iranian customers have joined the game. At the same time, South American market, in particular Brazilian one, is temporarily calm now. However, as domestic quotations are expected to increase soon, interest in imports from Russia will probably rise. Moreover, Ukrainian suppliers note larger number of orders from West and Central Africa.
As a result, most Russian mills, including MMK and NLMK, have managed to close June order book, while Severstal keeps selling the material. Export prices for Russian HRC have dropped by $5-10/t over the past week. Buyers can also book the material from Ukraine’s Zaporizhstal, which started offering June production only at the beginning of last week. Ilyich, in turn, is still staying away from the market due to substantial number of orders left from the previous months. Metinvest International S.A. is expected to announce July prices for the mill''s flats at the end of May.
In particular, market players report the latest deals for HRC from MMK have been closed at $705-710/t FOB Novorossiysk, by $5-10/t lower than official prices. At the same time, most orders for the material came to steel traders from Italy, Turkey and Iran. So, Italian buyers have booked Russian HRC at EUR 525/t ($745/t at the exchange ratе EUR 1 = $1.42) C&F, which means about $710 FOB Novorossiysk excl. freight rates, according to market participants. Iranian customers, in turn, have purchased the similar material at $720/t C&F Anzali with payment by Iranian L/C ($680/t FOB Astrakhan). Given the favourable situation in foreign markets, the supplier will likely try to lift July offers by about $10/t.
NLMK has also succeeded in selling June output, and most volumes have been shipped to Turkey.
Severstal has used its monthly quota for flats supply to the EU over the past week, but still offers June production to other destinations. The supplier has failed to implement a week-ago rise in prices for HRC to South and North America, and thus has been forced to lower quotations to $690-700/t FOB St. Petersburg against $700/t FOB last week. In particular, market players report offers of HRC from Severstal to Brazil at $745-750/t C&F.
Mills'' offer prices of Zaporizhstal to large trading companies have generally remained the same in a week – $655-670/t FOB ($640-655/t CPT) Odessa depending on destination. In the Middle East, the producer’s HRC can be reportedly bought from traders at $675/t FOB. The similar material in the Eastern Europe is quoted at month-ago levels. Suppliers have managed to reach the highest prices to
Turkey owing to an upturn in buying activity there. Market participants report Airol Metals AG has sold HRC from Zaporizhstal to Turkey at $705-710/t C&F (about $680-690/t FOB Nikolayev or $665-675/t CPT Nikolayev), by $40-45/t higher than in April. Besides, this week Airol Metals AG has started testing the Bulgarian market with new prices for Zaporizhstal material, which are by $50/t higher than a month ago. However, it is ready to discount $20/t if buyer is interested in the contract.
( Source: www.metalexpert-group.com )