According to Mysteel, the Turkish market is currently affected by multiple factors, and the demand for finished products in both the domestic and export markets is not performing well.
In currencies, a weaker lira boosted local steel prices. USD/Lira is currently trading at 13.4100, compared to 11.1279 on December 31 and 9.5507 on October 31. The recent sharp fall in the lira has led to a sharp rise in the price of finished long products in the domestic market, as Turkish mills pay for imported raw materials in U.S. dollars before selling the long products to the domestic market in local currency.
Affected by severe winter weather, the market demand for rebar is almost non-existent, and the largest snowfall in recent years has hit demand for steel in the construction industry in most parts of Turkey. However, Turkish mills have been trying to keep rebar prices in the $700-710/t EXW range in recent days after their input costs, especially energy costs, soared with the recent rate hike.
In addition, the market is also facing a crisis of energy supply shortages. On Jan. 19, state-owned energy company Botas asked major consumers to cut consumption by 40 percent as imports of Iranian gas were suspended for 10 days. According to earlier reports, Turkish power transmission company TEIAS also said on late January 21 that it will cut off power supply except for residential and office users to balance the supply and demand situation.
According to market sources, Turkish mills are holding on to price hikes amid gas shortages and strong scrap prices, which currently do not have cheap scrap stocks to allow for lower rebar prices. A Turkish trader said that most mills insist on exporting rebar at US$710/t fob, adding that around US$700/t, slightly less than 10,000 tonnes is feasible, but not a good deal for mills trade.
According to Mysteel’s assessment, the export price of Turkish rebar was US$700/ton FOB on January 25, an increase of US$5/ton over the previous period; the imported scrap HMS 1/2 (80:20) was US$468/ton CFR.
Post time: Jan-26-2022