As Turkish lira depreciation against the US dollar accelerated following the dismissal of Central Bank governors with a presidential decree on Oct. 14, Turkish mills’ lira denominated rebar list prices rose further.
The Turkish lira lost a further 1% value against the US dollar following the dismissals, hitting an all-time record Lira 9.18/$1, while all eyes turned to the next monetary policy meeting of the Central Bank, which will take place on Oct. 21, as it is known that President Erdogan is against high interest rates. Erdogan has changed the bank governors four times since 2019 for increasing interest rates.
New interest rate cuts could be possible at the Bank’s monetary policy meetings in the coming months.
The increasing trend in Turkish mills’ lira-denominated rebar prices accelerated Oct. 14 in this sentiment.
Major long steel producer, Icdas raised its 12-32 mm diameter rebar list prices by a further Lira 160/mt on Oct. 14 to 7,800/mt ex-works Biga, equivalent to $720/mt, excluding VAT. The exchange rate was Lira 9.18/$1.
With that hike, the rise in the Icdas rebar list price reached $50/mt since the beginning of October. The move also came amid the ongoing rise in imported scrap prices and strengthened market conditions.
S&P Global Platts assessed Turkish imports of premium heavy melting scrap 1/2 80:20 Oct. 13 at $480.25/mt CFR, up $12.75/mt on day to reach the highest level since July 19.
Other Turkish mills have also raised their rebar offer prices generally to the $720-$730/mt EXW range Oct. 14, depending on tonnage and region.
Although demand in the domestic market has been relatively strong in recent weeks in a rising market, accelerated depreciation in Turkish Lira could hamper trade in the domestic market in the coming weeks as winter approaches.
— Cenk Can