Turkish long steel exporters see demand dry up

Turkish long steel producers had a very quiet week in terms of demand and have been forced to further decrease their rebar and wire rod prices in both domestic and export markets.

Turkish mills’ rebar offers, which previously stood at $410-420/tonne fob actual weight, have decreased mostly to $400-410/t fob Turkey actual weight this week. Offers at $415/t are still available from some producers. For wire rod, offer prices mostly stand at $415-430/t fob, down from $425-440/t fob a week ago.

Customer bids, however, though very limited, stand at $20-25/t below offers for both products.

A Turkish long steel producer tells Kallanish: “The situation is awful. No calls, no e-mails, nothing during the week. Some inquire just to check the market and declare price levels that are impossible to accept.”

A Turkish mill in the Aegean region is heard to have sold rebar to Israel at $390/t fob Turkey. Asia is closed due to lockdowns in ports. Buyers in Singapore are asking for delays to their previous purchases. Demand in the USA is also weak as US buyers have low price expectations from Turkey.

Another Turkish producer says: “I can’t decide which one is worse between rebar and wire rod. Last week we sold 6,000 tonnes of wire rod to South America at $430/t fob. This was our last sale.”

Besides the negative effects of the coronavirus, the fall in scrap prices has also caused the limited number of buyers to back off and decrease their price expectations. Buyers think Turkish rebar export offer prices should be at $390/t fob levels, as they are in the Turkish domestic market.

Another Turkish producer says: “Buyers are bidding too low, even for small quantities. We are ready to decrease our prices if we can find satisfactory quantities. But with these volumes, it is becoming harder.”

Rebar prices in the Turkish domestic market have also decreased since last week. Domestic demand remains low as a result of falling scrap prices, coronavirus measures and Ramadan. Prices have fallen to TRY 3,230-3,250 /t ex-works, including VAT, depending on the region, from TRY 3,300-3,370/t a week ago. With the lira at 6.98 per dollar on Thursday, these prices translate to $392-394/t ex-works, excluding VAT, down from $400-408/t on 22 April.