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CIS flats exporters not going to back down next month - 06 Aug 11

After two weeks of trading, CIS exporters of flats have managed to fill the order book for August. Most of them have signed contracts at last-month’s levels while others have had to make reductions. Suppliers have been able to close deals for August output so fast on improved demand from European buyers ahead of the holiday season as well as on traders' restocking in the Middle East before Ramadan. Besides, offers of August output from Ukrainian suppliers were limited due to orders left from the previous month.
Despite coming traditional lull in Europe, the Middle East and North Africa, market players hope buyers from these regions will remain active to some extent in August as some of them may be interested in the material with October shipment. Besides, market players report inquiries for the material continue to come from CIS and the Middle East, in particular from Saudi Arabia, which also encourages exporters.
In late July, Russia’s MMK sold out the entire August output to Southern, Northern and Western Europe, Latin America (Brazil) and the Middle East (Iran, Jordan, Israel). Buyers from the UK have bought HR flats at EUR 510/t FOB St. Petersburg, and cold-rolled products – at EUR 620-625/t FOB St. Petersburg. Substantial volumes of the material from Russia’s Severstal have been booked by European buyers (mainly from Northern and Western Europe).
However, producers do not expect exports of September rolling to grow. MMK reportedly plans to cut exports to 140,000 t in September against 170,000 t in August on lower production. Another Russian company, Severstal, which exported 170,000-180,000 t every month during 2011, also may cut export shipments, though it has not announced plans to decrease production yet, hoping to sell more material in the domestic market. Thus, Russian suppliers are intending to lift export prices for September rolling of coils by $10-20/t by cutting supply to foreign markets.
Ukraine’s Zaporizhstal offered to foreign markets only some 90,000 of August rolling with late September shipment because of orders left from the previous month. As a result, the supplier has closed deals with traders at the levels of the previous month. However, initial prices were by $10/t higher two weeks ago.
August rolling of HR flats from Ukraine’s Ilyich has been mainly offered by Steel Trading Solutions AG, which sells about 30% of the producer’s coils jointly with SabinaPak. In particular, Steel Trading Solutions AG has sold some 25,000 t of HRC to the Middle East, including Syria and Lebanon, at $685/t FOB Mariupol. At the same time, market players say Metinvest International S.A. keeps offering August-September rolling of Ilyich's HRC at $685-690/t FOB Mariupol. August output of HRC is available to Turkish buyers at $710-715/t C&F, but no deals have been reported.
(Source: www.metalexpert-group.com )
Aug 6, 2011 07:56
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