Russian and Ukrainian billet exporters have attempted to pass on high ferrous scrap costs to Persian Gulf buyers by increasing offer prices, although they have failed to secure bookings due to poor demand.
Billet re-rollers and traders in the Persian Gulf have rejected the latest offers quoted at $480-490 per tonne cfr, and MB has heard of no bookings since transactions at $460-470 two weeks ago.
With Middle Eastern local market rebar prices at $500 per tonne ex-works (exw), the latest offers are too high to enable re-rollers to make a profit, they said.
“No one is buying billet from the CIS because prices are unworkable,” a representative from a re-roller in the UAE said.
“We have billet booked weeks ago that is arriving at ports next week. If we bought billet at $460-470 per tonne cfr than we would not make a profit when rebar is being sold on the domestic market at around $500 per tonne ex works,” he added.
A Dubai-based trader told MB he had heard of offers at $490 per tonne cfr Persian Gulf for February delivery, although no one has accepted that price.
Iranian steelmakers offered billet to the Persian Gulf at $480-485 per tonne fob or $500-505 per tonne cfr, a second Dubai-trader based trader told MB.
But these prices were also rejected by consumers, they said.
But no bookings have been concluded at that level as prices are the same as the domestic rebar price, which is around $500 per tonne ex works, according to Persian Gulf market sources