As predicted, Turkish exporters of longs and semis are in no hurry to raise prices further, as foreign buyers are careful about purchases, making deals only for small lots of the material in the end of the year. However, market participants believe the situation to improve next week when customers from the USA and Europe come back to the market after holidays, which along with ongoing growth of scrap quotations will allow suppliers to start the upward race. In particular, steel traders forecast export prices for longs to climb by at least $10/t at the beginning of January.
Meanwhile, sellers keep quoting rebar to be produced in early February at $660-670/t FOB, in line with last week. Yet, more and more suppliers (Nursan Group, Diler Holding, Ekinciler and others) prefer making offers at the upper end of the price range.
Contracts are expected to be concluded mainly with Far Eastern buyers this week. In particular, market operators are sure customers from Iraq as well as UAE and Saudi Arabia will book Turkish rebar actively as its offers are rather attractive now. Moreover, deals with Yemeni consumers, to which the material is available at $660/t FOB actual weight ($685/t C&F theoretical weight), which is by $80-100/t (incl. import duty) higher than domestic prices, are also possible as local producers, like Iraqi ones, cannot meet requirements of the whole market.
At the same time, demand for Turkish rebar from North Africa and SE Asia is not expected to grow because offers from local producers are likely to be more attractive in these countries.
As for US market, buyers are booking local February production actively, so its prices are expected to go up further. Turkish suppliers, in turn, are still counting on this destination given the fact that their offers are much lower than domestic ones. Nevertheless, the material is reportedly changing hands at the end of December at about $660/t FOB actual weight ($680/t C&F theoretical weight).
The wire rod segment is seeing the similar situation: quotations have not changed over the same period – $660-675/t FOB. At the same time traders, who needed the material, have already restocked, so now they just watch price movements aside. Yet, suppliers still hope to sell at least small volumes of steel products to North and Central Africa as well as Middle East in the short term. Besides, demand for Turkish wire rod from US customers is forecasted to strengthen as soon as in early January for the same reasons as in rebar segment. At the same time, exports to Europe, including Italy and Spain, will be minimal because domestic prices, even taking into account their gradual growth, are still more acceptable.
Most sellers of semis, in turn, prefer to refrain from making new deals so far, being sure they will be able to get more profit in early January. In particular, Colakoglu stays out of the market, steel traders report. As a result, the price range has broadened up by $5/t in a week, to $630-640/t FOB amid limited supply. Moreover, the most successful exporters manage to close deals with Iranian buyers at $635-640/t FOB as demand has somewhat improved here by the end of the year.
As for imports, Turkish consumers are holding back from deals with Ukrainian suppliers, bidding $620-625/t C&F, which is $10/t lower than offers. However, some market players believe if CIS sellers fail to sell large volumes to other markets, it is highly probable that they will finally make concessions to local re-rollers.
Source: www.metalexpert-group.com