Purchasing activity remains subdued in the Turkish market. Downward pressure has continued to be exerted on negotiated finished steel prices. Market participants are presently trying to maintain manageable inventory levels. In the flat product segment, the preference for short term agreements between buyers and sellers persists. This situation is predicted to continue until the business environment normalizes.
Trading conditions in UAE remain difficult. Sentiment amongst distributors is low. Nothing has transpired that suggests purchasing activity will turn the corner in either December or January. Foreign suppliers have modified their flat product and construction steel offers several times. Only small quantities of material have been ordered. CIS suppliers have struggled to sell material despite their lower quotations. At present, no one is prepared to carry unnecessary high stocks into the New Year.
Indian flat product steelmakers have downgraded their flat rolled material prices. Producers have linked these revisions to the downturn in global prices and an appreciation in the Rupee. The actual reduction is not that significant because less generous discounts are being offered. Construction steel prices have been under pressure since July/August. The majority of the majors have rolled forward their October values. Producers have been hesitant to lower their quotations owing to the cost of scrap and semi finished products.
The business environment in South Africa remains arduous. ArcelorMittal South Africa has lowered some of its domestic offers for November. The mill has stated it reduced the figures in its local quotations according to international price trends and the Rand/Dollar exchange rate. Local buyers are not convinced. The benchmarking favored by the steelmaker does not echo market conditions. These are the first downward revisions since the producer started to raise its prices in July. Highveld has continued to follow AMSA’s pricing direction, albeit at a final price which is around 1% to 2% lower than its competitor.
Sentiment in the Brazilian market remains mixed. The spotlight has once again fallen on the pricing policies of internal steelmakers. Distributors have raised their domestic offers after their purchasing discounts were moderated. The price rise has drawn criticism from users. Producers have also started to contact their flat product customers over a possible December price rise. Higher raw material costs and a stronger Real are being held responsible. Rising scrap and billet values have raised concerns that long product quotations may edge higher.
A few segments of the Mexican steel market are starting to show positive signs. Negotiated prices have been under less pressure in November. In general, end users remain content with purchasing small lots of material. This trend will more than likely continue in December and January.
Russian steelmakers surprised the market with their conservative November offers. Observers had predicted more substantial cuts. Export quotations have been adjusted to reflect the general health of global markets. Last month’s coking coal shortage has been blamed on the Sayano Shushenskaya hydro electric power station accident. Russian coal companies raised their deliveries to local power plants to prevent power shortages.
In the Ukraine, effective construction steel values have started to exhibit signs of weakness. Pressure is being exerted by price competition amongst distributors and producers, as well as the onset of weaker seasonal demand. Domestic flat product offers are more or less untouched. The Ministry of Economy has started to examine the pricing strategies of the local steelmakers. Attention is being paid to the disparity between domestic and export prices. In recent months, local quotations have started to edge higher whilst global prices have fallen.