Posted on 19 Nov 2020
Rising CIS export bids have seen some suppliers withdraw from the market with a view to re-entering later with higher quotes, Kallanish notes.
In the flat products export market, a Ukrainian supplier withdrew after selling some hot rolled coil volumes to Turkey at $580-585/tonne cfr late last week. Turkish domestic HRC offers already exceed $600/t ex-works and only March-rolling availability is left. The supplier's late-January-rolling availability and relatively easy logistics therefore mean the buyers will get the material at least one month earlier than if they had ordered domestically.
Indications of willingness to pay $600/t cfr have not yet enticed the supplier to re-enter the market, with traders expecting it to come back next week.
In the slab market, February-loading material is still available from two CIS mills, and trading is likely to start at $500/t fob Black Sea, sources say. All volumes are likely to be swept up by Turkey. Turkish HRC producers will need all the slab they can book, one source notes, and even at $520/t cfr it will be affordable considering the latest HRC sales at around $600/t ex-works/fob.
CIS billet suppliers are also not actively marketing January casting, but inviting bids, traders say. Drawing-grade billet was heard sold to Turkey at $475/t cfr, netting back to $460/t fob Black Sea, the price one Russian coastal producer was offering on Monday. But this price is unlikely to be available today, one trader notes, as scrap is nearing the $330/t cfr Turkey threshold, which will encourage CIS mills to offer at higher levels, in line with finished steel price hikes.
Although Turkish rebar is still at around $500/t fob in the export market, wire rod prices are rising fast and buyers "…can't get enough of it, especially in the Turkish domestic market and in Europe," a Black Sea trader says. Billet at $475/t cfr Turkey for wire rod production affords around $110-120/t drawing margin at current wire rod offers of $580-600/t fob Turkey.
Source:Kallanish
