Posted on 15 Oct 2018
Turkish flat rolled steel producers continue to battle the downward pressure of low demand both at home and in export markets, and stringent credit condition, Kallanish notes This is restraining their manufacturing and trading capability, market sources say.
Turkish prime hot rolled coil offers stood at $570/tonne fob base from one producer, but could go down $10-15/t for a large volume, according to traders. Although sales are slow, Turkish mills have the advantage of being able to produce thin-gauge wide coils, which their Russian and Ukrainian competitors do not supply.
Another, lower-priced producer sold a HRC lot to Egypt at $555/t cfr, netting back to around $540/t fob, in line with the traditional price difference of about $10-20/t with other, older, mills. In southern Europe, where local mills have reduced prices last week, demand is at around $540/t fob Turkey base equivalent, for prime HRC material, traders say.
There were no imports of HRC into Turkey this week.
The Turkish domestic market appears even quieter, with very low sales volumes and end-users implementing intermittent production breaks lasting one to two weeks. Last week one of Turkey's largest car manufacturers Tofas said it would stop producing for nine days on the back of slowing sales.
While one mill's offers remain at around $570-580/t exw, another mill is ready to discuss sales at $560-570/t exw, market participants say, but demand is so low, lowering prices is not supportive. "If someone comes with firm bid, even if it’s much lower than offers, mills will sell. The trouble is, firm bids are hard to come by these days, as distributors and end-users are pressured by lack of demand too. The situation will get worse before it improves," a local trader concludes.
