Experts predict a rise in prices for rolled metal in July

Prices for rolled metal in regional markets in the coming month will increase due to the activation of traders due to the need to replenish warehouses after a long pause in purchases, according to a press release from the state enterprise Ukrpromvneshekspertiza (UPE) on Monday.

At the same time, it is noted that the positive dynamics of prices will be facilitated by the limitation of the supply of rolled products due to stoppages of enterprises for preventive repairs, as well as the rise in the price of scrap in Turkey and an increase in spot prices for coking coal in China.

This will allow suppliers to take a firm stand and insist on an increase in prices, despite the still sluggish demand in the construction sector in the Middle East and the decline in consumption during the summer holidays in Europe.

In addition, it is reported that under the influence of weak demand, regional prices for metal products in the first half of June 2017 decreased compared to May by $ 5-20. From the middle of June the conjuncture began to change for the better and the prices, first of all, for the billet, began to grow, having risen by $ 5-10 by the end of the month. The end of Ramadan had a positive impact on the rise in prices, and in the first week of July, most regional quotes increased by another $ 10-15.

"Thanks to stable domestic demand, China is showing the highest growth rates. Over the three weeks of June, domestic billet prices rose by $ 30-33 to $ 492-509 /t EXW, VAT included. Rebar and wire rod rose by $ 11-12 to $ 561 /t and $ 556 /t EXW with VAT, respectively, "- comments on the situation the expert of the company" Ukrpromvneshexpertiza "Oleg Gnitsky, quoted by the press service.

According to him, the favorable internal environment (demand, high prices and sales margins) gives reason for Chinese suppliers to insist on a significant increase in export prices. In the first week of July 2017, offers from China increased to $ 440-460 /t FOB for billets, $ 460-490 /t FOB for rebar and $ 480-490 /t FOB for wire rod, which becomes a price benchmark and determines the value trend of companies in other regions. ...

Importers in SEA markets are resisting price increases, trying to close deals at the lower end of the current price ranges. However, the limited free volumes of supply and the uncompromising position of suppliers due to the good filling of the order portfolio do not allow finding alternative sources of supply at acceptable low prices.

According to O. Gnitetskiy, in Turkey, the stable demand for procurement in the context of the beginning of the rise in prices for imported scrap (+ $ 22 over the last three weeks of June) led to an increase in domestic and import prices, respectively, to $ 430-450 /t EXW and $ 425-435 /t CFR. Turkish companies raised prices for foreign markets to $ 430-435 /t FOB (+ $ 13 per week), taking advantage of the formation of demand after Ramadan in the import markets of the Middle East. However, n