Posted on 03 Dec 2020
CIS hot rolled coil export supply is only available from one Ukrainian producer for March-loading material, and from one Russian one, for April-loading volumes. Two other Russian suppliers are either only supplying the EU from the Baltic, or have no allocations until April, which they are not yet considering offering, market sources tell Kallanish.
CIS HRC prices have gained $100/tonne since a month ago and are now ranging from $615-625/t fob Black Sea, depending on the volume and origin. Ukrainian offers to Turkey are at $635-645/t cfr depending on the coil size and producing mill, and $645/t cfr to Egypt. Russian material for April loading from the Urals-based mill is meanwhile at $640/t fob to all destinations.
According to traders, these prices will be accepted by buyers, amid a catastrophic shortage of material, practically in every corner of the globe. Sources observe mills in every exporting region giving priority to domestic markets, leaving traditional importers strapped for coils.
European demand continues apace, joined by US HRC prices rising to a level that would enable imports despite the 25% import duty, should there be availability, traders note. Akin to Europe, some US end users are being forced to reduce or stop production altogether, as their stocks are non-existent after a long absence from the market.
Several observers expect Section 232 measures to be removed on account of these shortages, as soon as feasibly possible, they say.
Cold rolled coil availability is low, "…if such thing is possible", traders say, and this shortage is pushing HRC demand and prices even higher. There is no price, traders say, but bids come up to $900/t cfr from Turkish producers.
"The reason we are doing very little today again is the opposite to what it was just a couple of months ago – too much demand, but no supply, and it is likely to continue for some months," a seasoned trader quips.
Source:Kallanish
