In the final days of May, CIS and Turkish billet prices are seen to be maintaining their strength on the back of raw material prices. While rebar prices in particular have continued to decrease in southern Europe, Turkey and in various Middle Eastern countries, billet and scrap prices have not deteriorated to the same extent. Finished steel prices have continued to decline due to lack of demand, whereas semi-finished and raw material prices are showing sustained strength. In this general context, EAFs and rolling mills have been having certain difficulties in terms of raw material purchases and have been refraining from purchases unless backed up by sales.
In the Turkish domestic billet market prices have this week been at $370/mt ex-works. Local Turkish rolling mills which produce long products have not been inclined to accept billet at this price level, especially as domestic rebar prices have been showing fluctuations but mostly in a downward direction. Considering rolling costs as well as billet prices, rolling mills which produce rebar are of the view that current billet prices do not allow sufficient room for profit margins. Merchant bar prices have also been on a stable trend in Turkey this week. Mills that have been experiencing difficulties in selling finished steel products are refraining from purchasing billet for the time being, in the expectation that billet prices may decrease further.
Billet offers given from the CIS have also maintained their strong trend this week, with levels of $350-370/mt FOB CIS. However, demand for billet is expected to determine the general trend of prices in the international market.