During the sixth week of 2008 (February 4-10) the CIS export markets were characterized by calm as regards levels of activity. Buyers in both the CIS scrap and billet export markets adopted a wait-and-see policy, abstaining from purchases because of the high prices. Meanwhile, the CIS flats export markets saw low activity ahead of the announcement of new prices.
As for the CIS domestic markets, during the week in question both the Russian and Ukrainian domestic longs markets continued their strengthening trends, while these countries' domestic markets for flat products saw a slight slowdown in their rates of increase. Meanwhile, scrap markets in Russia and Ukraine showed stabilization trends during the week ended February 10.
Scrap: Black Sea region scrap market still quiet due to high prices
The Black Sea region scrap market continued in its calm state as regards scrap purchases during the sixth week of the current year. The reason for this tendency was the same as during the previous week - i.e. the reluctance on the part of Turkish steel producers to pay the asked prices for A3 grade scrap, regardless of the slight price decrease during the week in question because of the drop in freight costs. The market is expected to remain in a tranquil state at least till the beginning of March as producers have enough raw materials for production. Meanwhile, A3 grade scrap from Russia's Far East ports saw a slight increase in price mainly because of the reduced scrap availability for export and the bad weather conditions.
The Russian domestic scrap market entered a stable phase during the past week, with no price changes observed in the market. However, its seems that the market stability will not last long, as rather high demand for finished products, both within the country and from Russia's export markets, in the context of the general winter slowdown in scrap collection will cause domestic scrap prices to rise a bit further.
The Ukrainian domestic scrap market saw some price fluctuations during the week ended February 10. However, the price rising trend affected only individual mills, leaving the overall market price level for scrap unchanged.
Longs: New price rise in CIS exports fails to attract buyers
As expected during previous weeks, CIS billet exporters finally increased their quotations during the week ended February 10. However, buyers in the Middle East and Gulf regions are reluctant to pay the increased price, and are adopting a wait-and-see strategy instead.
As for long products of CIS origin, they also underwent an increase in export prices during the week in question. However, as in the case of billets, consumers in the Middle East and Gulf regions, considering this increase unreasonable, are currently abstaining from active purchases.
The Russian domestic longs market saw another price rise in the rebar segment during the sixth week of the year. Thus, the rebar price in the Russian retail market saw an average increase of Ruble 600/mt ($24/mt).
The Ukrainian domestic longs market also continued trending upward during the week ended February 10. Under the effect of growing domestic demand, the retail price for rebar in the Ukrainian market increased by UAH 50/mt ($10/mt).
Flats: Calm in CIS export markets ahead of new price announcements
During the week ended February 10, the CIS flats export market continued to wait in expectation of the announcement of new export prices.
The Russian domestic flats market still grew in strength during the week ended February 10. However, compared to the previous week, the rate of increase in the Russian flats retail market in the past week was not that significant, about Ruble 150/mt ($6/mt) for HR and around Ruble 70/mt ($3/mt) for CR.
The Ukrainian domestic flats market showed some stabilization tendencies during the week ended February 10. Although the prices for flat products continued to rise in the Ukrainian retail market, the rise was somewhat smaller compared to the previous week.