A slight optimism has started to show in Turkey’s billet market, although for now a bit more in terms of demand than for pricing. One reason is that import scrap prices have rebounded in the most recent transactions, while another is that the allocation of import billet in Turkey’s market is quite scarce, particularly for origins with a shorter lead time. By the middle of the week, the general offer prices for billet in Turkey, including the indications from China, Indonesia and the Black Sea, have narrowed down within a limited range and some deals are expected to be heard shortly.
The latest offer levels for prompt shipment Russian cargoes have been reported at $540/mt CFR and slightly above, while the most recent deal for 3,000 mt ex-Rostov was closed last week at $541/mt CFR. The offers for April shipments to the northern part of Turkey have been heard at $530-540/mt CFR. The SteelObis daily reference price for Russian billet has stabilized for now at $505-515/mt FOB, with the midpoint at $510/mt FOB. It is worth mentioning that large Russian billet producers mainly prefer to stay out of the market for now. “We do not see any positive price dynamics. Therefore we are holding back billet offerings,” the representative of a mill told SteelOrbis.
Chinese billet offers have reappeared in the market at the levels of $525-528/mt CFR for end-of-April shipments and some market players strongly believe the $515-520/mt CFR mark might be reachable. Other ex-Asia offers, mainly from Indonesia, have been reported at $530-540/mt CFR, down $10/mt over the week. Although some market players believe Asian suppliers are shorting the market, the indicated price level is quite workable at the moment, taking into account that mills are trying to avoid selling rebar below $590-600/mt FOB nowadays. Still, billet from Indonesia and Malaysia is expected to be preferred over China even despite the price difference. “It is risky to buy from China since one might end up with the supplier non-performing if any rebound is seen over there,” a billet seller to Turkey told SteelOrbis.
Turkey is expected to target $520-525/mt CFR for Asian billet and there has been talk of around 40,000 mt of ex-Indonesia origin sold to Turkey within the range. However, it was not confirmed by the time of publication. “The last price on FOB sold by them [Indonesia] is $490/mt and with the extra for Mn it makes $494/mt FOB or $531/mt CFR considering freight for such a volume,” a trader said.
Iranian billet offers are also present in the market for very limited lots and for truck/train transportation. An induction billet offer has been reported at $452/mt FCA, while EAF billet has been on offer at $480/mt FCA. The delivery cost to the Karabuk region is estimated at around $50-60/mt.
In the domestic market in Turkey, integrated mill Kardemir has announced new billet sales at $10/mt higher than a week ago, at $555/mt ex-works for S235JR and $565/mt ex-works for B420 grade. No actual sales list has been disclosed to the market by the time of publication, but many believe only up to 20,000-25,000 mt of billet have been traded, given that last week Kardemir sold over 55,000 mt. Billet offers in the Marmara region have been reported at $565/mt CFR before the scrap price rise, and the level was not considered workable at that time. The general level of offers across Turkey is currently estimated at $555-565/mt ex-works, up $10/mt on the lower end over the past week.