CIS longs exporters have almost closed June order book, and mainly stay away for the market at the moment, intending to come back with July prices in late May. Stable demand for wire rod due to short supply in export markets has expectedly provoked growth of wire rod prices at the Azov-Black Sea ports, but the Far Eastern market continues to stangnate. At the same time, although rebar is in good demand in the Middle East (Iraq) and North Africa (Egypt), conditions in the segment are still unfavourable. Suppliers have failed to push through a rise in rebar prices and to reduce the difference between rebar and wire rod offers (about $60/t).
Ukraine''s ArcelorMittal Kryvyi Rih has already collected enough orders for June this week: after last-week sale of small volumes of rebar at $700/t FOB, the latest deals for the material have been made at $680-685/t FOB, and for wire rod – at $750/t FOB. In particular, a large batch of rebar (over 20,000 t) has been reportedly sold to Iraq at about $680/t FOB Black Sea.
Notably, after a long-lasting downtime period (since mid-2010), Moldova SW resumed operation of its electric steelmaking complex on May 25 and of a long product mill – on May 26. The company preliminarily plans to ramp up the steelmaking shop to almost full capacity in June: the entire output of rebar will be sold to Russia, wire rod will be exported mainly to non-CIS countries. Metinvest International S.A., being scrap supplier to Moldova SW, will reportedly become one of the distributors of the material to foreign markets. According to Metal Expert’s data, wire rod of June rolling was sold at $740/t FOB. Currently, the producer has just small volumes of the material available.
Metinvest International S.A. has closed sales of wire rod from Makeevka SW at $740-750/t FOB June production, while Belarus SW has sold rebar at $673-685/t FOB.
The Far Eastern market has seen no dramatic changes: demand for wire rod is poor in SE Asia, while quotations of the material are still on the verge of decreasing. So, after selling some volumes of June production at about $695/t FOB, Evraz Holding is unwilling to deal at such low prices any more and is out of the market now. At the same time, traders report the latest tender of Amurmetall was closed with a sale of wire rod at $680/t FOB.
Nevertheless, strong demand for wire rod in the Iranian market has made suppliers of Russian material become more active: offers of June output are reported at $730-740/t FOB Caspian Sea. However, supply is rather limited, thus the market is still seeing a shortage of CIS finished longs.
Quotations of structurals have remained practically the same too. So, channel and I-beam (up to 200 mm) from Ukrainian mills are available to foreign buyers at $725-735/t FOB. At the same time, the major part of June production has been already booked up.
( source: www.metalexpert-group.com )