Black Sea billet prices show more downside on weak sentiment
CIS mills have lowered billet offers further in the last few days in a bid to win business in the export markets.
Byelorussian Steel Works (BMZ) closed its tender for July shipment at $360/metric ton FOB Odessa, with full
advance payment, having slashed the last asking price by $5/mt, multiple sources reported on Wednesday.
A trader noted that the BMZ cargo amounted to 25,000-30,000 mt and was most likely sold to Turkey. “It’s quite a
good price, better than I expected,” the trader said, equating the FOB level to $375-380/mt CFR Turkey. Some
allocation from BMZ was also sold to Latvian rebar producer KVV Liepajas Metalurgs, which backed away from the
plan to produce its own billet.
The remaining CIS producers kept their offers between $365-370/mt FOB Black Sea/Sea of Azov but buyers stayed
on the sidelines on possible further drops in export prices. Some market watchers expected to see billet sales below
$360/mt FOB soon.
In North Africa traders were heard offering $385-390/mt CFR Tunisia. One trader was seeking even higher levels.
Also, a cargo from Ukraine (ISD DMKD) was rumoured to have been booked for a prompt shipment at $380/mt
CFR Egypt. A source close to the situation said the deal involved 40,000 mt and closed at $387/mt CFR Damietta.
Another market observer noted that the price "was very good in either way", saying the FOB level should have been
at $363-370/mt.
“It is really difficult to say where the prices are now because nobody is buying,” a trading agent commented. The
Turkish market in particular slowed down in the post-election uncertainty and the lira’s tumble. Nevertheless, activity
was likely to show some pick-up ahead of Ramadan starting in a week’s time. "I am already seeing more inquiries
compared with the beginning of the week and hopefully on Monday there will be even some deals," a European
trader commented.
On Wednesday Platts assessed its daily billet price at $363/mt FOB Black Sea, $1/mt down.