Buyers, who had expected the rise to be smaller, opposed the much higher prices from CIS flats suppliers, causing Russian exporters to realize they had added too much to their offers of March production and make reductions. However, the suppliers' moves have only aggravated traders’ reluctance to deal in the market which is getting weaker even despite current demand from foreign buyers. Thus, Ukrainian exporters have backed down, following Russian sellers. Moreover, prices for CIS HR flats are expected to keep sliding down to $700/t in the near future.
In particular, sellers of Russia's MMK products are more likely to consider buyers’ bids rather than to set their own nominal prices when selling material to the countries, in which quotas on imports are not effective. They have made such decision given the fact that their last-week offers of HRC at $830-840/t FOB Novorossiysk have seen strong opposition from customers. However, buyers, in turn, have also revised their purchase prices in several steps and already voiced them at about $760-770/t FOB against $800-810/t FOB only a few days ago. In fact, they have some reasons for the revision. For example, a deal with Indian consumers has been reportedly made at $765/t FOB.
Suppliers have also changed prices to Eastern and Central Europe, cutting offers of HRC by EUR 40/t to EUR 630-640/t ($869-883/t at the exchange rate EUR 1 = $1.38) DAP.
As for Russia’s Severstal, it has reportedly closed March order book, probably redirecting unsold volumes to the domestic market. At the same time, official prices for HRC to be rolled in March from the mill were generally unchanged during the week ($815/t FOB St. Petersburg), but contracts were concluded at prices by some $20-25/t lower, traders say. Moreover, it is rumoured that the company decreased quotations to India to $750/t FOB St. Petersburg, but no contracts were reported. The similar material in the EU market lost EUR 20/t and is available at EUR 630/t C&F Gdynia (Poland).
HRC from Ukraine's Zaporizhstal are being offered at $730/t FOB (about $715/t CPT) Odessa, down $20-25/t from a week ago. CR flats prices have gone down by $15-20/t to $840/t FOB ($825/t CPT) Odessa. At the same time, the supplier is reportedly ready to grant discounts if a buyer is interested in purchase.
Market players report export prices for HRC from Ukraine's Ilyich have also changed somewhat over the same period. So, offers of the company’s products to the Middle East and North Africa have sunk by $10-15/t to $740-745/t FOB Odessa. In particular, traders claim HRC from Ilyich can be bought at $755/t C&F in Turkey and at $800-805/t C&F in the UAE.
( Source: www.metalexpert-group.com )