Longs suppliers in Romania keep offers stable, local demand still limited
Following the election held last weekend, which resulted in stable currency exchange rate levels, Romanian long steel spot traders have opted to keep prices unchanged week on week.
However, in terms of trading activities, players stated that local demand has not demonstrated any improvement and has remained steady, albeit at limited levels, this week.
On the other hand, the sole Romanian rebar producer which is not presently producing has no new offers, so the previous offers have continued to be heard, but, according to sources, there is not much interest in the sole producer owing to a lack of essential materials.
Currently, the majority of traders have kept their rebar prices unchanged week on week at €595-610/mt ex-warehouse, with their wire rod offers stable at €580-595/mt ex-warehouse. Meanwhile, as previously stated, the sole Romanian rebar producer has not made any fresh offers, and earlier offers of roughly €590-605/mt ex-works continue to be heard in the market, stable week on week.
Furthermore, there have been some import offers this week, though interest from Romanian traders has remained minimal. According to sources, offers for rebar from Bulgaria have remained stable at €610-630/mt CPT. Likewise, Egypt has also kept its rebar and wire rod offer prices unchanged at €510-520/mt CPT and €535-545/mt CPT, respectively. Greece, on the other hand, has offered rebar and wire rod at €605/mt CFR and €595/mt CFR, respectively. Meanwhile, Turkey’s average rebar price has also remained stable week on week at €515-530/mt CFR Romania, with a €1 = $1.13 exchange rate and around €25-30/mt freight.
Romanian longs prices unchanged amid market uncertainty caused by currency swings
Following the Romanian presidential election which caused currency fluctuations and market uncertainty, the majority of long steel traders and the sole domestic rebar producer have decided to hold offers unchanged compared to last week and to just monitor the market.
However, given the changes in currency rates, many participants believe that some upward adjustments in long steel prices may occur. Meanwhile, some suppliers believe that, owing to the ongoing weaker demand, price adjustments may not be supported by buyers.
“Romania’s unstable political situation has resulted in extremely low sales this week. Following the first round results, the euro and US dollar exchange rates will be updated for pricing in lei, and long steel prices will be adjusted in the coming days to reflect the new exchange rate. Considering the low sales volumes and the unstable political climate, I personally believe that neither price rises nor even customer acceptance of such levels are likely,” a trader said SteelOrbis
As a result, the sole local producer’s rebar pricing is unchanged week on week at €590-605/mt ex-works. Similarly, the retail prices of rebar in Romania are stable at €610-620/mt ex-warehouse since last week.
In the wire rod segment, a similar scenario has occurred due to the current uncertainty. The majority of traders offered wire rod prices at unchanged levels of €580-595/mt ex-warehouse.
Meanwhile, as regards imports, Bulgarian suppliers have reduced rebar offers by €10/mt to €610-630/mt CPT, while ex-Egypt rebar and wire rod prices remain stable from the previous week at €530-535/mt CPT and €535-540/mt CPT, respectively. In contrast, ex-Turkey offers have increased as mills’ export offers have been quoted at $540-550/mt FOB, and, with the current currency rate of €1 = $1.13, prices for delivery to Romania are now at €505-515/mt CFR, up from €495-515/mt CFR last week.
Romanian longs prices stable, but rises anticipated due to reduced quota
Following the European Commission’s announcement of decreased tariff-rate quota volumes, the Romanian long steel market has begun to anticipate increased domestic market price movement.
However, no price swings have occurred in Romania, and offers from Romania’s sole rebar producer and traders have remained stable over the last week. On the other hand, with the announcement of quota reductions, some traders anticipate difficult times for the domestic market, while others are keeping an eye on how the market adjusts.
Currently, the sole Romanian rebar producer’s prices have remained stable week on week at around €580-590/mt ex-works, while most traders have kept their rebar prices unchanged week on week at €590-605/mt ex-warehouse, with their wire rod offers stable at €570-595/mt ex-warehouse.
Meanwhile, in the import market, after Turkey sold some rebar to Romania in the previous week at $555-560/mt FOB, Romanian buyers have remained silent on imports this week, probably due to their sufficient supply and recent EU quota changes. However, this week, Turkey’s average rebar price has increased by €5/mt to €545-560/mt CFR Romania, based on a €1 = $1.09 exchange rate and a freight cost of €25-30/mt. In contrast, Bulgaria’s rebar offers have remained stable week on week at €620-630/mt CPT. In addition, Egypt, which had been missing for a few weeks, has returned to the market this week, offering rebar and wire rod at €550-555/mt CPT and €560-565/mt CPT, respectively.
Bulgaria steelmakers continue production despite electricity costs
Bulgaria’s metallurgy industry will not stop production despite restrictively high electricity prices, Bulgarian Association of the Metallurgical Industry (BAMI) executive director Politimi Paunova tells Kallanish.
“I hope this is a temporary critical situation caused by high electricity prices and the authorities will continue the compensation scheme for businesses that was in effect until the end of 2024,” she says. “After a reaction from the national employers’ organisations, a solution is expected as soon as possible. Companies, albeit with some delay, should receive the relevant financial aid.”
Bulgarian metallurgical companies continue to operate and there is no information yet about shutdowns, Paunova adds.
“The future not only of Bulgarian metallurgy, but also of the entire European energy-intensive industry depends on energy prices and their comparability with other competitive producers in the world,” the BAMI executive director notes. “At this stage, compensation for businesses is imperative and is not expected to be discontinued in the next few years. Under these conditions, Bulgarian metallurgy, as well as other sectors of industry, can operate and be competitive.”
Paunova points out that stopping production altogether would lead to very high costs when restarting the lines, so steel companies prefer to reduce production to consume less electricity, which results in losses.
Bulgaria’s main employers’ organisations received assurances this week from all political parties in the National Assembly that the mechanism for 100% compensation of companies’ costs at prices above BGN 180 ($94) per megawatt-hour will be continued this year.
Last Friday, the chairman of the Bulgarian Electricity and Gas Association (AIKB), Vasil Velev, called on businesses not to rush to pass the new, still unsubsidised price of electricity in January on to prices of their products and services. Since the beginning of the month, electricity prices have averaged over BGN 250 per megawatt-hour.
On Monday, Velev called on producers not to stop work due to high electricity prices as he is confident the compensation mechanism will be continued.
In January-November, Bulgaria saw crude steel output fall by 3.5% on-year to 426,800 tonnes, according to worldsteel latest data.
Svetoslav Abrossimov Bulgaria
