Day: 3 October 2022

Turkish merchant bar and sections producer Kocaer Celik, which is aiming to focus more on value-added steel production with new investments, is also planning to expand distribution channels in overseas markets, the company said Sept. 30.

“In line with our overseas strategic growth plans, we are targeting to raise our business volume and revenues in export markets by expanding distribution channels,” the company said in a statement to the public disclosure platform.

“Within this scope, we are aiming to continue our growth in our existing distribution channel in the UK and to establish similar companies in other countries,” Kocaer said.

The company changed the name of its MyMetal Ltd affiliate in the UK to Kocaer Steel UK Limited, as of Sept. 29, it also said.

Kocaer has a combined steel production capacity of 800,000 mt/year at its three Turkish mills producing merchant bars, beams, channels and sections.

The company built a new 100,000 mt/year hot-dip galvanizing line at the beginning of 2022 to increase its structural steel output.

Value-added steel products currently make up 40% of the company’s total steel production, with Kocaer saying in a statement it aimed to raise this to 50% at the end of 2022 and to 75% in 2024.

It currently exports 84% of its steel output to 140 different countries, it said.

Although long steel export prices at Turkish mills rose sharply, especially in March, prices have declined since then due to a sluggish market environment.

Platts, part of S&P Global Commodity Insights, assessed Turkish exported rebar at $682.5/mt FOB Sept. 27, down from an intra-year high of $970/mt FOB reached March 24.

— Cenk Can

Domestic heavy plate prices were stable in Italy over the week to Sept. 30 despite a slowdown in demand.

Platts assessed plate in Southern Europe at Eur1,000/mt ex-works Italy Sept. 30, unchanged over the week.

Deals and tradable value have been reported at Eur1,000-1,050/mt ex-works Italy.

Domestic prices in Germany moved down on the week as steelmakers gave discounts to settle deals.

Platts assessed plate in Northern Europe Eur25 lower on the week at Eur1,075/mt ex-works Ruhr Sept. 30.

Transactions and achievable prices have been reported at Eur1,070-1,080/mt ex-works Ruhr, while offers have been heard at Eur1,050-1,100/mt ex-works Ruhr.

Demand for heavy plate has softened this week as a majority of stockholders have already booked required volumes earlier in September. Slower trading activity, however, was unlikely to result in a price decline as demand from projects and other buyers remained healthy and as mills had good order books.

“Plate demand has declined a bit this week, mainly as stockholders have booked what they needed over the past couple of weeks,” an Italian source said. “Rerollers in Italy have sold out October and part of November rolling, so the demand slowdown had no negative impact on prices.”

In addition, the ability of steelmakers to give discounts was limited by elevated energy costs.

Platts assessed import slab in Southern Europe at $600/mt CIF Italy Sept. 30, unchanged over the week.

Cheap import offers from South Korea have disappeared from the market this week after the deals had been settled at $570-$600/mt CIF Italy earlier this month.

But offers from Asia still have been reported at $600/mt CIF Italy and from India — at $650/mt CIF Italy.

Platts is part of S&P Global Commodity Insights.

— Maria Tanatar

In an about-turn from a recent interim recommendation, the UK’s Trade Remedies Authority has proposed to keep anti-dumping measures of between 18.4% and 22.5% on imports of steel rebar from China, the authority stated Sept. 30.

The measures are applicable on imports of high fatigue performance steel concrete reinforcement bars from China into the UK that are typically used in the construction industry, it said.

The TRA has changed its original proposal to abolish the duties due to the availability of additional data and economic forecasts since the July publication of a Statement of Essential Facts (SEF) and receipt of new responses from participants in the trade case, it said. The TRA no longer considers that keeping the measures in place would result in supply issues for HFP Rebar.

In July 2016, definitive anti-dumping duties on the product were imposed by the European Commission, and the TRA’s recent review of the product’s status is a transition review, initiated in April 2021, following the UK’s exit from the European Union, the SEF noted.

The EC, however, allowed the EU’s anti-dumping measures on the Chinese HFP rebars to expire in July 2021 without review.

The TRA was formally and legally established in 2021 as an independent arm’s-length body of the UK’s Department for International Trade, or DIT.

In a statement issued Sept. 30 detailing the reasons for the TRA’s about-turn on its previous recommendation, the TRA said that the likelihood of dumping and injury occurring from the imports continues, and therefore it is recommending to keep the current anti-dumping amount.

The TRA had previously “identified a risk that the Russian invasion of Ukraine may lead to a shortfall in supply of HFP Rebar in the UK as a result of a significant reduction in imports from Russia, Belarus, and Ukraine, which have historically been significant sources of HFP Rebar for the UK market,” it said in a public notice. “The import data, which has become available since the publication of the SEF, shows that imports from Russia, Ukraine, and Belarus have fallen as anticipated; however, these have been replaced by imports from other countries such as Portugal, Spain and Turkey.”

In addition, recent forecasts for the construction sector and the UK economy as a whole now indicate that demand for HFP rebar is unlikely to rise as previously anticipated. As a result, the continuation of the anti-dumping duties on Chinese imports would not have any significant impact on supplies to the UK’s construction industry, it said.

“New evidence suggests that international supply has proven to be more resilient than we anticipated and the forecasts for demand look weaker,” the TRA said in the public notice. “We no longer consider undersupply of HFP Rebar to be likely. We, therefore, conclude that maintaining the measure is in the economic interests of the UK.”

Import data from the UK’s tax and customs body HMRC shows that imports of rebar into the UK from all origins rose over January-May to around 230,000 mt, up from around 170,000 mt and 200,000 mt in the same period of 2021 and 2019, respectively, before the impact of COVID-19. Imports were just under 150,000 mt in January-May 2020, a period when the market was impacted by COVID-19, the data showed.

UK importers of the Chinese rebars were cited in the original 2016 EC decision to impose duties as CMC Ltd, Eurosteel Ltd and Ronly Ltd.

Following the latest recommendation from the TRA, interested parties have until Oct.14 to comment. The TRA will then produce a final recommendation, which will be sent to the secretary of state for international trade to take the final decision on whether to uphold the TRA’s recommendation.

— Diana Kinch

French and Luxembourg domestic scrap prices are forecast to remain mostly stable in October in a month-on-month comparison but with uncertain sales volumes.

High energy costs and the downturn in finished products are causing steelmakers to plan or foresee continued periods of plant mothballing, to save on energy bills and balance supply with demand. Apart from some steelmakers who have announced fourth-quarter stoppages, mills do not have a clear production plan for October and will decide on output by the day depending on energy price movement, Kallanish notes.

In France and Luxembourg, lower scrap demand is expected to show in October. However, forecasts of scrap price stability are being heard in Germany and Italy, mostly due to the most recent rebound in Turkish scrap.

Negotiation in France, Luxembourg and Germany will start next week. If the price stability becomes a reality, French and Luxembourg domestic shredded E40 grade should remain at €350-365/tonne ($342-357/t) delivered on average. The mixed E8 grade was at €360/t in September. E1C and demolition grade E3 should also remain at around €300/t delivered and between €340-345/t delivered on average respectively this month, sources suggest.

The main concern in the sector is the weak performance of finished long and flat products. Sources who spoke to Kallanish believe European steel prices in October will suffer from a major price fall driven by prolonged market stagnation and overcapacity.

Meanwhile, dock prices in the Benelux were at €300-315/t delivered on Monday last week, up from €275-290/t. They were driven by a Turkish steel demand rebound, which however did not last long after Turkish mills increased their rebar prices sharply the week prior.

In France, ArcelorMittal, Ascometal and Ascoval are announcing production cuts of up to 50% over Q3 (see Kallanish passim).

Natalia Capra France

The Italian distribution sector expects prices in October to fall, but in a gradual and controlled way. Very slow sales amid a collapse in apparent and real demand are plaguing the entire value chain, Kallanish hears.

Some sources believe end users of all flat and long products are withholding purchases because downstream industries can no longer absorb high domestic prices. Many buyers are turning to cheaper imported material, leaving local producers with the crumbs.

Some end-use sectors that buy sheet and welded tube are suffering lacklustre demand and mostly selling from stock, buying as little as possible from both re-rollers and service centres. This is causing a big decline for sheet prices and expectations of further falls.

Intensified competition among sellers has caused hot rolled sheet to go below the level of €800/tonne ($782) ex-works, with expectations for €750/t in October. Domestic sheet is also competing with low-priced imports. Other end-use sectors, however, are reported to have a good level of orders but are limiting their purchases because of high prices.

September was a relatively good month for welded tube sales. Discounts in Italy were between 22-23 points, up from 20 points two weeks ago. Some players decreased their prices and managed to sell volumes, while some end-users are said to have good order books.

Significant overcapacity is plaguing rebar and merchant bar sales, with service centres and distributors reporting a “demand crisis” and collapse in consumption.

Merchant bar is flat at €670-690/t ex-works, as is rebar at around €660-680/t base ex-works. Buyers believe these products will both fall in October and mills will continue to implement stoppages to balance demand and supply. Including size extras, merchant bar is at €1,090-1,110/t ex-works while rebar remains at €920-940/t ex-works, sources suggest.

Natalia Capra France

The European hot-rolled coil market was quiet at the end of the working week, with minimal trading activity reported amid persistent oversupply, sources told Fastmarkets on Friday September 30.
Fastmarkets calculated its daily steel HRC index, domestic, ex-works Northern Europe at €751.67 ($731.47) per tonne on Friday, down by €5.83 per tonne from €757.50 per tonne the previous day.

The latest calculation of the index was down by €13.33 per tonne week on week but up by €16.67 per tonne month on month.

Buyers’ estimates of achievable prices were reported between €730 per tonne exw and €790 per tonne exw, depending on tonnage.

Trading activity, however, has remained minimal in the region despite mills being prepared to offer discounts for larger tonnages.

“Producers are desperate for orders, but nobody is looking to restock now,” a trading source in the region said.

Mills in the region were still able to offer coil with November delivery, sources said.

Buyers and producers expressed different expectations regarding the price trend.

Some mills were confident that production cuts will start to have an effect toward end of the fourth quarter this year, and some even said they expect an HRC price rebound in response to inevitable restocking.

Buyers, on the other hand, were certain that more output cuts were needed to balance the market and did not expect any recovery in trading activity or an HRC price rebound, even in the first quarter of 2023.

“We are heading toward recession,” a distributor in the region said. “There are no signs of demand recovery, and production cuts have had no impact on the market so far. We expect more mills in Europe to reduce or cut output in the fourth quarter.”

Fastmarkets’ calculation of its daily steel HRC index domestic, exw Italy was €758.75 ($738.36) per tonne on Friday, down by €1.25 per tonne from €760 per tonne on Thursday September 29.

The latest calculation of the Italian index was down by €2.50 per tonne week on week but up by €42.08 per tonne month on month.

Buyers’ estimates of tradeable price levels remained at around €750 per tonne exw for large tonnages and €770-780 per tonne exw for small tonnages.

Italy’s market was also quiet on Friday with little to no trading activity reported.

“We do not need [HRC] tonnages for the fourth quarter. We will look into first-quarter [booking] in November,” a trading source in Italy said.

Import HRC offers to Italy were largely flat week on week, with no fresh booking reported recently.

Offers of HRC with late fourth quarter delivery from Turkey were heard at €710-720 per tonne cfr Italy.

At the same time, several sources said that one supplier from Japan was offering HRC with early first quarter 2023 delivery at €690 per tonne cfr Italy.

And finally, boron-added HRC from India was offered to Italy at €680-690 per tonne cfr.

Published by: Julia Bolotova