Business activity in the CIS export market for square billet has plunged this week. Suppliers from the Azov-Black Sea basin keep insisting on prices announced last week and do not plan to step back. CIS square billet sellers get some optimism from attempts of Turkish longs makers to fix prices at last-week levels. However, foreign buyers of square billet still doubt that prices have stabilized. As the religious holidays will start in the Middle East in early November, regional buyers do not make deals expecting quotations to keep going down in the second half of the month. At the same time, square billet exporters are still cutting prices in the Caspian region, but fail to attract buyers due to complicated financing in Iran. Far Eastern customers show minimal interest in CIS semis given lower domestic prices and their fears to import in the falling market. As a result, steelmakers have revised offers downwards again having a need to sell their output.
Thus, demand for CIS billet in Syria, Egypt and Tunisia observed in the second half of October has fallen to zero by now, although some producers are ready to sell November casting at $585-590/t FOB Azov/Black Sea, like a week ago. At present, bid prices are by about $10/t lower.
At the same time, DEMZ quotes billet (about 10,000 t available) at $585-590/t FOB. Metinvest International S.A. has started offering November output from Yenakievo at $590/t FOB Black Sea. Market players say Metalloinvest offered square billet of November production from OEMK at $595/t FOB Black Sea early this week, but no contracts have been reported.
Some suppliers are also ready to sell December casting. For example, December production of 140 mm square billet from Belarus SW (30,000 t) is available at $590/t FOB Black Sea. However, no one shows interest in the product given its specific size, a possibility to produce it till end-January and 100% pre-payment. December square billet from ArcelorMittal Kryvyi Rih can be booked by overseas buyers at $585-590/t FOB. At the same time, not all suppliers are in a hurry to sell December production. For example, having closed November order book at $595/t FOB in the middle of the month, Ukraine’s Elektrostal is staying out of the market. However, the supplier intends to sell December billet output not below the latest contract levels.
At Caspian ports, the situation is largely aggravated by payment problems, although CIS square billet is in demand there. As a result, in order to attract buyers, Casting has cut its November prices in two stages by $40-50/t in a week, to $600-610/t CPT ($610-620/t FOB) Aktau, though no deals have been reported so far. Prices for November square billet output from Ural Steel have dropped by around $20/t in a week, to $600/t FOB Astrakhan, pre-paid. Market players say the supplier should reduce offers by another $10/t to lure buyers. Besides, offers of November square billet output from Volga-FEST are coming to Iranian customers by $25/t lower than a week ago – at $600-605/t FOB Astrakhan.
A 4,000-tonne batch of November square billet from Aktau foundry (Kazakhstan) is offered to Iran at $610/t CPT Aktau, and the supplier is ready to cut the price by another $10/t. Meanwhile, KazFerroStal was offering square billet at $620/t CPT (6,000 t) but got no response from buyers and decided to leave the market.
In the Far East, re-rollers are reluctant to buy the material, waiting for prices to stabilize. However, large traders have managed to knock down prices from Amurmetall by $12/t compared to the most recent deal and again purchased 10,000 t of square billet at $593/t FOB.
( Source: www.metalexpert-group.com )