Prices for billets from the CIS countries continue to grow

The rise in prices for billets from CIS countries resumed after a hiatus last week with at least one new booking in Turkey at higher prices.

At the end of last week, the Russian mill sold billets in Turkey at $ 527 per tonne as scrap prices continued to rise and this month, according to numerous traders, could reach $ 400 per tonne. But the alleged purchase by the Marmara plant this week of a large batch of Ukrainian billets at a price of $ 540 per tonne is being questioned by several sources. They say it could be drawing material or Qatari cargo. The proceeds from the sale will be about $ 528 per ton on the Black Sea market.

This level was probably paid for by the mill, which also produces flat-rolled products, whose uncharacteristically high margins could offset the likely zero-margin for rebar.

The indicators of CIS manufacturers are 525-535 dollars per ton fob, which is unrealistic for traders. According to one trader, the lower end of the range is unlikely to be available anymore. Consequently, with the rise in scrap prices, the billet price is almost the same as for Turkish rebar, which appears to be absorbing growth much more slowly.
The workpiece ordered today will be used for rebar production at the end of the first quarter - beginning of the second quarter. “Turkish rebar factories need to be confident enough to keep their domestic and export demand for rebar in the second quarter at this level in both the import and domestic market, where prices reached $ 540 per tonne from the plant,” notes a major trader.

Some rebar suppliers left the market on Tuesday without submitting any firm bids, despite relatively strong demand, which is nevertheless below the factories' expectations.

While the rise in iron ore and scrap prices justifies the rise in billet prices as measured by traditionally accepted margins, at present only wire rod suppliers can pass these increases onto their customers.

Rebar prices, which have remained almost at the billet level, are a serious concern for some rolling mills, which could lead to the fact that factories will temporarily stop offering and generally producing rebar, participants said. This temporary supply reduction could trigger price increases, although much broader measures are needed to stimulate rebar demand and subsequent price increases.

Meanwhile, CIS suppliers of billets have a high level of shipments in February and seem unwilling to cut prices. According to traders, there are very few offers on the market and factories