Turkish billet producers ready to negotiate

Posted on 15 April 2019

Source: Kallanish

Turkish billet exporters' bullish attitude towards pricing has been replaced with softer offer indications last week, from around $450-460/tonne fob a week prior to around $445-450/t fob, Kallanish learns from market sources.

The softening sentiment has swept across all long product-related markets on the tail of the several lower priced scrap purchases into Turkey, reinforcing the bearish trend in finished and semi-finished product markets. The resulting sales of rebar at an equivalent of $450/t fob actual weight to southeast Asia, have paved the way for decreases in billet prices. Sources insist however that the market is approaching the bottom in scrap, and also the semi and long products' markets as a consequence.

Turkish billet is available, some with very short, almost immediate, loading availability, leading the market to believe that some last-minute pre-Ramadan sales will be made at around $440/t fob levels. These could be perhaps even lower, depending on the flexibility of mills' maintenance plans. Pre-sales have been made by traders this week at $450-460/t cfr Tunisia/Morocco/Egypt. Expectations are therefore for Turkey/CIS billet to hit $420-425/t fob before the quiet month begins, and the market has a chance to reload, they say.

There were no Turkish billet sales in the market this past week, but a Ukrainian integrated billet producer sold a very large lot to Asia at an equivalent of $435/t fob Black Sea. Another, small scrap-based mill meanwhile, was out of a 10,000-tonne tender at $430/t fob Mariupol with prepayment, and did not sell, sources said. Two large tenders were also held by Middle Eastern and Latin American producers, still ongoing on Friday last week.

With new scrap bids at $305/t cfr Turkey for HMS 1&2 80/20 currently rejected by suppliers, the indications are that scrap price may be solidifying if not rebounding. This has afforded some support for the rapidly softening billet market, traders note. 

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