Posted on 26 Mar 2019
Turkish hot rolled coil export prices have remained within the range desired by producers after resisting an extremely-low, opportunistic bid. Small tonnages sold at these relatively high prices last week, Kallanish learns from market sources.
After a major price reduction two weeks ago by one mill in order to fill April-rolling books, and due to the weakening of the euro, the mill exited the market only to return with considerably higher offers. It rejected bids of as low as $500/tonne fob Turkey from some destinations, retaining offers at $540-545/t fob, for May-rolling material. This is in line with other suppliers’ offers and relative to the quality and terms at which the mill offers.
The resulting standoff between buyers and sellers did not last long, however, with one Turkish producer selling a 50,000t lot to Asia at $570/t cfr, netting back to around $530/t fob Turkey. Another mill is also reported to have made a large lot sale to Southeast Asia, but Kallanish understands this was a sale reported a week prior, at around $545/t fob for a 40,000t lot.
Having closed all April and most May-rolling books, Turkish mills are not expected to continue making concessions. This is despite persisting pressure, considering southern European HRC is available at €500/t ($565/t) cfr southern European port, according to sources. In order to compete with these, say, Italian prices in Spain, Turkish mills need to retain offers at attractive levels, not exceeding $525/t fob, sources suggest.
One trader went further, pointing to the softness in European coil, despite safeguards, as European mills try to win business and force exporters to lower offers. "What has changed with safeguards?” he asks. “European buyers have to reduce prices to compete with imports and exporters follow suit, reducing prices further – we all lose!”
