The situation in the billet market is still unfavourable for CIS exporters. Demand for semis remains weak in the Middle East, whereas Iranian consumers have withdrawn from the market, forcing suppliers to decrease their offers again and again. However, there are some positive changes. Turkish market has somewhat revived over the past week and local exporters have put billet prices up by some $5-10/t to $630-640/t FOB. However, sales from the CIS to Turkey are not increasing now. Although Asian buyers have become more active, a roll back in billet prices at the Black and Caspian Sea ports has had its impact. Having small quantities of March production, suppliers feel confident staying out of the market.
Square billet quotations of March production in Azov-Black Sea have slid to $610-620/t FOB in a week, from $615-640/t FOB. However, there are hopes for better outcome: whereas previous bids came at $590-605/t FOB, now they are $610/t FOB.
Noteworthy, BMZ opened sales of March casting at $640/t FOB Odessa on February 7 and tried to hold this levels as long as it could. However, by the end of the week it has made a $20-25/t reduction amid unfavourable conditions in the region. This has not born fruit as customers still insist on $610/t FOB. As a result, BMZ has withdrawn its offers and left the market.
At the same time, Russia’s Mechel keeps holding prices for billet from DEMZ (Ukraine) at $620/t FOB Mariupol. Market players say the seller is ready to make $5-10/t cuts.
ArcelorMittal Kriviy Rih (Ukraine), having evaluated the billet market, has decided to focus on longs sales. So, the producer is not going to offer semis of March production.
Despite unfavorable situation in the region, some trading companies have managed to close a number of deals for billet produced in previous months, in particular with the UAE, at $600-610/t FOB.
(Source: www.metalexpert-group.com )