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New Level for Semis- 23 Aug 10

Rusmet.ru, Victor Tarnavskiy/ Semis prices in global market increased in late July and early August.  In the middle of the month CIS exporters offered these products at $540-550 per ton FOB. According to traders the deals with delivery to were concluded in September at $560-565 per ton CFR. In the Gulf countries semis prices reached $570-580 per ton CFR, in - $590 per ton CFR. Semis in increased as well. Vietnamese buyers received the offers at $570-585 per ton CFR. CIS suppliers concluded contracts at $565-575 per ton CFR. Semis prices increase was provided at the same time with the increase in  rebar and  scrap markets  and was caused by raw materials and finished products  prices increase. According to some analysts, semis prices increase was caused rather by increased manufacturers’ costs, than by the demand growth.Nevertheless, in recent two or three weeks manufacturers and trades hardly could complain for low demand.  In the beginning of August low demand for semis were there in , and then in , , and some other Mediterranean countries. Vietnamese companies were rather active. However, the most consumers purchased semis in store relying for rally in construction in Sep.-Oct. after Ramadan in Muslim countries and rain season in . By the beginning of the second part of August semis prices in key markets stabilized. According to CIS exporters, the prices could not be raised higher than $550 per ton FOB.  Sales volumes after the beginning of Ramadan reduced, market activity started decreasing and is unlikely to restore (at least in Middle East) by the middle of October.Middle East rolling mills are provided with semis for several weeks ahead, so that the market recovery in Sep. is unlikely to be fast. At that the autumn increase is not guaranteed, although expected by most market players.  In the and in many analysts forecast new financial difficulties. In case of realization the negative scenario countries will suffer. But at least during next month semis prices in global market will remain rather high. First of all semis supply volume is rather limited, since many manufacturers from CIS and Turkey reduced the outputs and  are not going to increase it. Besides, even in case of the increase absence in Middle East the suppliers can rely on active demand in . In particular, after the fall in the first half of the current year Vietnamese construction industry recovered. Scrap market will not let semis prices to drop. According to experts, in the Q4 scrap shortage in global market can start and its prices will remain rather high.  In recent two months semis prices increased more than any other  steel products (by more than 20%) as compared with extreme decrease point in the second part of June. Obviously, in the nearest future there will be no fall in semis market.South-east AsiaMiddle EastEuropeUSAMiddle EastEgyptTurkeyIranSouth-East AsiaIranTurkey

Aug 23, 2010 08:53
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