Having increased offers by $30/t a week ago on strong domestic demand, Turkish exporters of rebar have still failed to keep them from falling given that foreign buyers mainly refrain from closing deals. So, the latter believe buying activity in Turkey will fall soon and prices will slide, so after that those who need to restock may start signing contracts, likely for small lots. At the same time, despite weak demand from abroad, no significant changes have been observed in the segment for wire rod and billet.
Meanwhile, suppliers attempt to cope with the current market situation. While early this week exporters were ready to discount up to $10/t compared to week-ago prices, by the middle of the month they lowered reductions to $5/t. However, market players estimate buying is no longer at its peak in the domestic market, and export offers will go down by the end of next week. Nevertheless, steelmakers will probably make just slight reductions ($5-10/t) as they plan to start booking scrap, though prices for it are not expected to move up.
At present, Iraqi buyers are interested in Turkish rebar owing to large number of construction projects. As a result, suppliers offer the material to this destination at $740-750/t EXW. At the same time, to Lebanon the material is priced at $735/t FOB, and a number of deals for small volumes have been done here amid stronger demand in the country.
Having managed to book Turkish rebar at much lower prices earlier, UAE trading companies keep staying in a wait-and-see mode given that construction activity will remain slow in the country till the end of Ramadan. Amid low buying activity in the Egyptian longs market and sufficient stocks, buyers purchase only local material and just for urgent needs, its prices being more attractive than those for Turkish products. Although rebar is still in good demand in Saudi Arabia, customers keep insisting on discounts of at least $15-20/t, but Turkish sellers are unready to make the cuts so far.
Turkish rebar attracts almost no US customers either, since prices in the US domestic market are quite reasonable.
Despite poor demand from foreign buyers, wire rod suppliers do not grant discounts while selling August output so far. Consumers from East and West Africa are highly interested in Turkish products, but no deals have been reported yet as they probably wait for reductions.
Only the upper end of the price range for August casting of billet has added $5/t over the week. Nevertheless, although Saudi Arabian and Egyptian buyers show interest in Turkish material, they still hope for a decrease. At the same time, billet offers of CIS suppliers (August production) to Turkey are by about $45-50/t lower than export prices for rebar, which is quite acceptable for Turkish steelmakers, despite their growth. However, no contracts are reported so far.
( Source: www.metalexpert-group.com )