After a gradual price decrease, CIS exporters of square billet have totally given up in early April. Producers seem to leave any attempts to keep up appearances and try to close sales of April casting at any cost. Although scrap prices stay stable so far, the fact that they are likely to go down has confused billet suppliers. As result the latter have finally agreed to buyers’ levels in view of extremely weak demand.
So, while a week ago exporters worried semis quotations in the Azov-Black Sea basin to drop to $600/t FOB, now prices for the material have crossed that line, and market players are discussing much lower level ($580/t FOB). Notably, sales of square billet to be produced in April have been practically closed, while only few suppliers have started offering May production. Nevertheless, sellers working from the Caspian and Far Eastern ports are in no hurry to start selling May casting.
In particular, at Azov-Black Sea ports suppliers have managed to raise sales by cutting quotations of billet down to the level, on which buyers insisted as early as last week, to $590/t FOB. However, not all producers are ready to make so considerable reductions and are mostly quoting $605-610/t FOB. Moreover, ArcelorMittal Kryvyi Rih has reportedly sold small volumes of May production at $605/t FOB. Yet, given the current situation, it will hardly make such a deal once more.
Nevertheless, with billet offers of May production by at least $30/t higher than other suppliers’ prices, Belarus SW probably hopes to close contracts at current market prices more easily.
At the same time, IUD has not filled April order book yet, unwilling to sell even at $600/t FOB, traders report.
Situation in the Caspian region remains quiet after holidays: Iranian buyers together with suppliers are in a wait-and-see mode, and exporters are expected to start offering billet to be produced in May only by mid-April. Currently, only traders sell the material from the Caspian ports, quoting billet produced in the previous months at about $615/t FOB. However, Iranian consumers are ready to pay no more than $605/t FOB.
At the same time, situation in the Far Eastern market keeps worsening: Asian consumers’ bids have decreased by $20/t just in a week, to $630-640/t C&F (about $605-615/t FOB). Nevertheless, the latest tender of Amurmetal has been closed at about $635/t FOB, by $20/t lower than in late March.
Evraz Holding makes no offers of May casting so far. However, given downward sentiments in the region, the supplier will probably have to make considerable cuts – by at least $20/t, to $645/t FOB.
( Source: www.metalexperts-group.com )