Most billet buyers in Turkey still prefer to watch the current market situation, particularly in regard to import scrap prices and fluctuating prices in China. While generally demand has been modest, it seems that a couple of Turkish steel producers have decided to restock with the cheapest import billet option available, i.e., China.
Turkey’s Kardemir announced new billet sales today, on September 11, at $530/mt ex-works for S235JR grade and at $545/mt ex-works for B420, down $5/mt compared to late August prices. Taking into account the $20/mt discount for 5,000 mt orders and one percent discount for orders over 500 mt for cash payment, Kardemir’s price works out at $505/mt ex-works, sources estimate. Kardemir sold 45,000 mt billet. “We cannot say that Kardemir’s new price increased pressure on import offers, but smaller buyers in Karabuk also use it to evaluate the workable ex-Black Sea prices,” a trader told SteelOrbis.
The SteelOrbis reference price for ex-Russia billet has remained stable at $460/mt FOB Black Sea, but the buying mood has been better this week. “Confidence returned this week and there are bids at $480-485/mt CFR TBS [Turkish Black Sea] for October shipment,” a seller of Russian material said. Last week, offers from both Russia and Donbass, the Ukrainian territory currently occupied by Russia, were at $485/mt CFR and $480/mt CFR respectively, but there was no response from buyers.
Today’s reference price for ex-China 3SP billet has increased by $7.5/mt on average to $430-445/mt FOB amid the improvement in steel futures. Most of the offers available from mills are at $440/mt FOB, which translates to $475-480/mt on CFR Turkey basis. However, the recent sales to the Turkish market by traders signal that the overall mood among traders is still not so good and they believe that low prices from China will return in the coming month. According to sources, two Turkish steel producers have each booked a 50,000 mt billet cargo from China for November delivery at $465/mt CFR or slightly below. The transaction price level is more or less in line with the lowest workable ex-China price in the previous round of restocking.