Posted on 10 Dec 2018
CIS hot rolled coil prices remain weak, although some producers have attempted slight increases on the back of the short-lived uptick in Chinese prices last week, Kallanish notes.
Prices on a fob Black Sea basis of $470/tonne for large and $460/t for small hot rolled coils were indicated by one Urals-based Russian producer at the beginning of last week. It then increased its offers by $5/t to $475/t and $465/t respectively. Its offering for cold rolled coil also increased from $550/t to $555/t fob towards the end of the week.
The mill increased its offers despite lack of ongoing demand in all its major export markets, but it is understood that it has allocated all its January rolling tonnages earmarked for export. It sold a very large volume to its daughter mill outside Russia at an equivalent of around $470/t fob, traders said.
Another producer, selling from Baltic Sea port of St. Petersburg, is offering HRC at €430/t ($490/t) fob to all markets, including Europe, Turkey and Latin America. At an equivalent of around $470/t fob Black Sea, this price is unlikely to entice buyers right now, traders say. Ukrainian HRC is offered at $455-460/t fob, they add.
Demand is lacking in Europe on expectations of the amendment of import quota distribution proceedings for 2019, while Southeast Asia is content with Chinese below-cost supply according to some traders. Vietnam, where Russian mills sell considerable volumes traditionally, is not workable at these prices, so back-to-back selling is no longer viable, while position-taking remains extremely risky as Chinese volatility is ongoing, traders say.
