CIS billet
exporters are pushing prices up in the Black Sea basin citing strong
demand in the Middle East and North Africa, as well as more expensive steel
scrap.
The latest contracts for Russian and
Ukrainian billet were closed at $370-375/t FOB Black Sea late last week and
early this week. Most mills’ offers are now $380-385 $/т FOB Black Sea though.
Rumours about BMZ selling some of its June production (20,000 t) at $375/t FOB
Odessa (100% prepayment) have also influenced pricing. “Given the transacted
price for BMZ’s material [fully prepaid], other producers will look for
transactions at $380/t FOB at the least,” a trader assumes.
In the past few weeks, consumers from
various regions in Turkey got down to purchases after a long break, spurring
buying activity. However, Chinese competition keeps affecting CIS billet
prices, as Chinese offers remain more attractive even after edging up to
$370-375/t FOB Black Sea. However, shorter delivery time remains the main
advantage of CIS exporters. In addition, scrap prices continue to go up
(+$8-9/t to prices for US material in a week), paving way for an increase in
import semis quotes.
In contrast to the Turkish market,
demand in Egypt has faded. First of all this is due to significantly worse
fundamentals of the finished product market. Moreover, the price idea on this
route has soared almost $10/t in a week. Nevertheless, local buyers say that
“buying CIS billet is advantageous even at this price.”
Metalexpert.com