During the 25th week of 2007 the highest levels of activity were observed in the CIS domestic markets, while the export markets, with the exception of scrap, showed relative stability. Meanwhile, prices in the Russian domestic scrap market started to rise in order to ensure steady domestic scrap supplies (although no one knows for how long the rise will continue) and the Ukrainian market stopped its fall. On the other hand, both Russian and Ukrainian domestic markets for longs experienced trends in the stable-to-decrease range during the week ended June 24.
Scrap: Russian domestic market starts to rise
The pressure put by Turkish scrap consumers on the CIS exporters during the 24th week produced its results during the 25th week. After a week of tension, the consumers of Black Sea region scrap were able to push the price down slightly and renewed purchases to some extent. In addition, the still relatively weak price situation in the Russian and Ukrainian domestic markets allowed the main scrap buyers from Turkey and other scrap importing countries to gain the upper hand in price bargaining.
The Russian domestic scrap market saw some upward movement in prices for A3 grade scrap during the week ended June 24. However, the main reason for the increases by the domestic steel producers is the low level of domestic scrap purchases and the weak competition from the Southeastern Asian scrap export market. As a result, in order to ensure a steady level of supplies, several steel mills hiked their prices by an average of Ruble 500/mt ($19/mt) during the 25th week.
On the other hand, the Ukrainian domestic scrap market achieved some sort of price stability during the week ended June 24.
Long Products: Domestic prices suffer from imports
After a $5/mt decrease during the 24th week, the CIS billet exporters experienced a rather calm 25th week. Although with decreased prices, the CIS billet exporters were not able to push the Middle East and Gulf markets to conclude sales due to the still low demand.
Although the Chinese longs exporters increased their prices for the Middle East and Gulf regions, these export markets for CIS origin products were still relatively calm due to the low levels of activity. As a result no changes in the export prices of CIS-origin rebar and wire rod were observed during the week ended June 24.
The Russian domestic longs market started to slow down during the 25th week due to the high level of market inventories as well as the increased imports (the Russian market can be considered as the most attractive nowadays due to the decrease in purchase activities elsewhere). As a result, rebar decreased by an average of $5/mt, depending on the region, while wire rod saw a negative correction of $7/mt.
The Ukrainian longs market continued to show mixed trends during the week ended June 24. On the one hand, structural steel retained its previous week's quotations. On the other, rebar continued to decrease, showing a UAH 10/mt ($2/mt) drop during the 25th week.
Flat Rolled: Domestic prices go down
Following the price movements of the 24th week, the CIS export markets for flats stabilized during the week ended June 24. Thus, regardless of the low activities in the Middle Eastern and European import flats markets, CIS-origin flats passed the week in question without any changes.
After a week of stability, the Russian domestic flats market experienced some negative corrections during the 25th week, when both HR and CR decreased by $3-5/mt in the Russian retail market.
The Ukrainian domestic flats market was governed by mixed trends during the week ended June 24. On the one hand, the retail prices for CR and galvanized steel decreased by UAH 25/mt ($5/mt) and UAH 40/mt ($8/mt), while the prices for HR remained relatively stable.