CIS exporters keep trying to spur long product buying. They have been unable to sell out March output for a long time because of the downward movement in the global market for the product. Sluggish demand from Far Eastern buyers still prompts sellers to make reductions. As expected, Turkish exporters have failed to push longs prices up to $690-700/t FOB. As a result, offers of Turkish rebar have not changed from $650-665/t FOB since last week, while those of wire rod have even dropped by $5/t to $665-680/t FOB.
Besides, no business with customers from the Far East has been done in the past month due to a lack of offers from Russia, where domestic demand remains strong. So, Eastern Europe is still the target sales market which CIS suppliers have focused on. However, they have been forced to back down there too, following general trend.
In particular, ArcelorMittal Kriviy Rih has reportedly come out offering long products to Romania and Bulgaria, having pared $25-45/t from their quotations in a month. Metinvest International S.A. has already closed March order books and is currently out of the market. The company says the lowest contract price for wire rod to Romania and Poland has been $690/t DAP Ukrainian border (or $690/t FOB). Yet, market participants report transaction prices lower by $10/t.
After a long break (from the middle of 2010), Moldova SW has returned to the export market. Traders report the supplier has already started testing buyers with quotations of March rolling, which are nominal. The seller intends to define the official prices in late February.
In the Middle East, offers of March production of CIS longs have been coming from ArcelorMittal Kriviy Rih only. Quotations of rebar and wire rod from the Ukrainian producer have plunged by $40-50/t compared to the month-ago levels. The upper end of the price range reflects offers to Iran and Iraq. However, buyers keep insisting on $10-20/t reductions.
Belarus SW has left the market after opening sales at $670/t FOB Odessa on February 7 and finding no customers. Traders say the producer is reluctant to sell its longs at $640-645/t FOB, which is the bidding price. Instead, it is planning to sell the material to Russia and Northern Europe.
At the same time, Evraz Holding, a supplier of wire rod from Russian ports of the Far East, is still sitting out of the market. The company has decided to delay sales of March production of the material, exports of which will be 8,000 t at most. Thus, quotations of longs are expected to increase in view of a shortage of CIS product and favorable market conditions in Asia. In particular, market operators believe that initial offers to Asia will come at $730/t FOB ($15/t up m-o-m).
(Source: www.metalexpert-group.com )