During the 11th week of 2008 (March 10-16) both CIS export and domestic markets continued to show rising trends. The only exception to this rule was the Ukrainian domestic scrap market which was stable as regards prices during the week in question. Meanwhile, prices both inside the CIS and in the international markets continued to trend up, reaching unbelievable levels.
Scrap: CIS export scrap price reaches unbelievable levels
During the 11th week, the Black Sea region scrap market continued to trend upward. Under the pressure of increased consumption in the CIS domestic scrap markets, the approaching implementation of the iron ore price increases, as well due to the continuous price rises seen in both the international and CIS domestic semis and finished steel markets, CIS scrap exporters once again hiked their prices for the Black Sea direction. As of last week, A3 grade scrap was offered to Turkey at $520-525/mt CFR. Meanwhile, the expectation of a rise in freights rates from the Black Sea has been causing even more distress for scrap consumers. In addition, A3 grade scrap showed an upward trend for the Far East direction, where the prices of scrap are rising at higher rates.
The Russian domestic scrap market was governed by a price rising trend during the week ended March 16. The price for A3 grade scrap went up by at least Ruble 600-700/mt ($25-29/mt) depending on the supplied region. The reason for such a trend in the Russian domestic scrap market can be found in the earlier regeneration this year of the Russian domestic finished steel market against the background of just normal levels of scrap collection for the season.
The Ukrainian domestic scrap market showed a stable trend during the week ended March 16.
Longs: Prices climb high in both external and domestic markets
During the week in question, CIS origin billets continued their rising trend, reaching unbelievably high levels. For instance, billet price offers for the Southeast Asian market, which is going through hard times as regards offer availability, are moving at a steady speed toward the level of $900/mt CIF. Meanwhile, the Middle East and Gulf markets are not lagging behind the Southeast Asian market, although offer levels have not yet reached as high.
As for long products, rebar and wire rod alike continued to rise in the Middle East, Gulf and Asian markets. Offers of CIS origin rebar as of last week reached $830/mt FOB, while wire rod of the same origin went up to $825/mt FOB. The prices are expected to continue rising.
During the week ended March 16, the Russian longs retail market started to feel the effect of the price announcements of the domestic producers and importers. During the week in question, rebar increased on average by Ruble 540/mt ($22/mt) in the Russian retail market.
The Ukrainian domestic longs market saw an even larger price rise during the 11th week of the year. Rebar prices in the retail market increased by an average of UAH 265/mt ($53/mt), depending on the delivery region.
Flats: Markets are getting stronger
During the 11th week, CIS flats exporters hiked their prices once again for the Middle East and European markets. Meanwhile, the most profitable markets for sales have continued to be the UAE and Iran, where, due to shortage of available materials, flat products of CIS origin have been reaching market levels of $1,000 CFR.
The Russian domestic flats market saw a considerable price rise during the week ended March 16. The retail prices for HR and CR products in the domestic market went up by Ruble 1,400/mt ($57/mt) and Ruble 1,000/mt ($41/mt) respectively. Meanwhile, the price gap between HR and CR in the domestic market is getting smaller.
In the Ukrainian domestic market, flat products continued to increase as well. During the week in question, retail prices for CR went up by UAH 245/mt ($49/mt), while HR increased by UAH 200/mt ($40/mt). Meanwhile, prices in the Ukrainian domestic flats market are set to rise further.