Most sales markets for CIS longs have weakened greatly by the end of this week mostly due to Ramadan celebration in the Muslim countries and summer holidays in Europe. The situation has been also affected by the financial market disorganization leading to a panic among market players. As a result, buyers have adopted wait-and-see positions making steelmakers lower their prices. CIS sellers will have to reduce their prices in view of falling export quotations of Turkish products. Ukrainian suppliers who have not filled up September order book yet are first to make downward adjustments.
In particular, rebar from ArcelorMittal Krivyi Rih has lost $10-15/t this week, and the supplier is ready to make additional discount of $5/t while negotiating. However, the products are still little demanded. Having piled up enough material in the second half of July, Iraqi importers plan to resume business in a month. Lebanese buyers have also become less active, but they may return to the market by early-September when construction activity is expected to surge. Weaker demand and lower domestic prices for longs in Syria restrain imports.
At the same time, Belarus SW managed to close their order books for September rolling of rebar at quite reasonable prices at the beginning of the week. The products were bought by trading companies which have most likely decided to book for a long perspective. Market players report up to 10,000 t of rebar was sold at $715 FOB Odessa to be shipped till October 20, 100% prepaid. Noteworthy, this level is unworkable now as Turkish products are $10/t cheaper.
Russia’s Novorosmetal is reportedly focusing on domestic sales thus setting pretty high export prices.
Demand for wire rod in the Middle East and West Africa has slackened somewhat too, and deals have been closed only for small lots this week. On the back of lower export prices for rebar, ArcelorMittal Krivyi Rih has had to decrease offers of wire rod by $15/t in a week. At the same time, Metinvest International S.A. has made no cuts so far, so its offers have remained practically at the last-week levels. The supplier has reportedly managed to sell wire rod to the Baltic countries at the prices equal to $750/t FOB Black Sea. These figures are rather high taking into account current quotations of wire rod from ArcelorMittal Krivyi Rih and Turkish suppliers in the Black Sea basin ($725-740/t FOB).
Meanwhile, exporters from the Far Eastern ports have succeeded in strengthening their positions thanks to a stable demand for longs in SE Asia. In particular, Evraz Holding has already closed sales of September output at $725-735/t C&F ($700-710/t FOB). The latest deals for these products were made at $730/t C&F ($705-710/t FOB depending on destination). Amurmetall, in turn, has been holding no tenders for wire rod since late July. Market players believe this is due to the fact the supplier is experiencing some financial problems as well as difficulties with raw materials supply.
Stockists' quotations for structural sections have not changed over the last two weeks. Market operators say September production is limited due to the manufacturing problems
( Source: www.metalexpert-group.com )
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