Buying activity in the export market for square billet at Black Sea ports has been quite low, which has resulted in a $5-10/t decrease from the end of last week. Previously, high activity was due to Iranian buyers, while other consumers could not afford the prices.
However, there is a balancing factor: CIS plants are dictating their price policy altogether, e.g. quotations of October output are all in the range of $560-565/t FOB. It is likely, though, that some suppliers might give up amid pressure coming from buyers. Currently, re-rollers are ready to buy at $555/t FOB highest, and only with immediate shipment. Such offers are uncommon and have not been reported of.
The future trend will become clear in the next few days. Besides, both sellers and buyers are experiencing difficulties. The first have their square billet stockpiled, the latter are forced to postpone semis purchases amid low prices for finished longs. Moreover, many re-rollers from the Middle East, Northern Africa and SE Asia are currently in need of feedstock as they have been staying away from buying for a long time.
Naturally, CIS plants believe they will be able to minimize losses by waiting and thus forcing foreign longs producers to start purchases, having increased their domestic quotations. However, the trend is unlikely. Traders believe the prices are probably to go down to $540-555/t FOB within two weeks.
(Source: metalexpert-group.com)