Turkish rebar slump continues, scrap fall accelerates
Turkish rebar producers are continuing to decrease their quotes amid weak demand. However, these lower prices are still uncompetitive in the global arena and are not spurring an export sales recovery.
On Thursday, Turkish mills’ export offers were mostly at $635-640/tonne fob Turkey actual weight, down from $640-650/t a week earlier. Offers for mesh-quality wire rod, meanwhile, were at $645-660/t fob.
Demand in export markets is almost nil and Turkey’s higher prices than competitors are failing to attract the limited demand that is available.
Turkey is seen to be serving its major markets, Israel and Yemen, only. There are some inquiries about Turkish rebar in these destinations, though volumes are quite low compared to previous years.
A western Turkish mill concluded 20,000 tonnes of rebar sales to Israel at $690/t cfr last week. This week, however, Israeli buyers’ price idea is no higher than $675-680/t cfr, which corresponds to a price below $630/t fob Turkey.
A Turkish mill tells Kallanish: “Rebar trade in the global market has slowed. Even if we decrease our prices, I don’t think this will help to increase capacity utilisation.”
Another producer says: “Turkish rebar prices are no longer a benchmark in the global market. Amid current production costs we cannot survive. The industry is in need of urgent incentives.”
Turkish long steel producers are expecting to see more challenging market conditions for at least 3-4 months unless some form of government incentives are provided, to help with costs, spur local demand or encourage exports.
Domestic rebar demand, which has been driving the market for a while, was weak on Thursday. Mills’ offers in the domestic market are seen standing mostly at $630-640/t ex-works.
Turkish mills, which were exerting pressure on scrap prices in order to decrease their production costs, have achieved a price drop, although to an insufficient extent.
Several bookings were heard on Thursday. A western mill is confirmed to have booked US-origin HMS 1&2 80:20 on Monday at $344/t and shredded at $359/t cfr Turkey for December shipment. Another western mill booked a Croatia-origin cargo on Wednesday comprising 20,000t of HMS 1&2 80:20 at $325/t and 5,000t of shredded at $340/t cfr for prompt shipment.
Another cargo from the Baltic is heard to have been booked at $340/t cfr for HMS 1&2 80:20, although this is yet to be confirmed. The latest short-sea booking from Romania, meanwhile, was done at $315/t cfr Marmara.
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Anonymous
Very good overview of the weekly steel market.
Anonymous