TURKEY FLAT STEEL: Demand to remain strong, prices firm in December

Flat steel prices are unlikely to fall in Turkey in December, and some increases are expected because raw material and global prices are rising, and buyers have low stocks.

"December will be good in terms of buying," a market participant said on Friday December 8.

"Then China is coming back [to the export market] in March (and will accept orders in February). Prices will probably fall then. And, [as] it is winter, demand is not very strong, [so] I do not expect sharp price increases," he added.

Another market participant questioned whether the current strong demand levels could be sustained.

"Demand is good, but will it continue? Producers should not hurry to increase prices," he said.

The country’s flat steel production is expected to keep increasing as buyers prefer local products to imports.

Turkey’s slab production totalled 9,787,000 tonnes in the first 10 months of 2017, up by 18.98% from 8,226,000 tonnes in the same period in 2016, according to the Turkish Steel Producers Assn (TÇÜD). 

Demand for flat steel imports has not been strong as prices have not been competitive.

Some deals were made for hot-rolled coil (HRC) in November at $535 per tonne cfr, but the volumes booked were small.

Metal Bulletin’s weekly price assessment for HRC imports in Turkey was $535-540 per tonne cfr on December 1.

The weekly price assessment for Turkish domestic HRC was $550-570 per tonne ex-works on December 1.

Turkey has 9% import duty for HRC imports.

November prices
Domestic HRC, CRC
Flat steel prices did not change much in November, when demand was moderate.

“Retail prices are weak, so we do not want to book anything. The market is slow towards the year-end, and the lira is losing value, so retailers are losing value,” one market participant said on November 17.

Metal Bulletin’s weekly price assessment for Turkish domestic HRC was $550-570 per tonne ex-works on December 1, narrowing upward from $560-570 per tonne ex-works on November 3.

The weekly price assessment for Turkish domestic cold-rolled coil (CRC) was $650-660 per tonne ex-works on December 1, up from $635-650 per tonne ex-works on November 3.

Coated coil
Turkish coated coil prices changed through November, with the hot-dipped galvanized (HDG) coil price increasing, while the price of pre-painted galvanized iron (PPGI) fell, as demand was strong for HDG.

The weekly price assessment for Turkish domestic 0.50mm HDG was $740-750 per tonne ex-works on December 1, rising from $715-725 per tonne ex-works on November 3.

The weekly price assessment for Turkish domestic PPGI, or color-coated coil, of 0.50mm gauge, with 9002 color code, was $820-840 on December 1, compared with $825-875 per tonne ex-works on November 3.

Demand was strong at the beginning of December for coated coil, and prices are unlikely to fall, sources said, noting that Turkey is becoming a strong player in export market as well for HDG.

Metal Bulletin launched a Turkey export HDG $ per tonne fob price assessment on Friday, December 8, with the weekly price assessment for the product at $740-750 per tonne fob on December 8.

Import prices
Import prices from the CIS region, meanwhile, were close to Turkey’s domestic flat steel prices in November, with buyers preferring to wait and see if prices fell and mostly preferring to buy local products.

The weekly price assessment for Turkish HRC imports was $535-540 per tonne cfr on December 1, down from $550-555 per tonne cfr on November 3.

And the weekly price assessment for Turkish CRC imports was $595-598 per tonne cfr on December 1, down from $610-620 per tonne cfr in the same comparison.

HRC exports
Demand for Turkish HRC was moderate in Europe in November, and Turkish producers targeted local sales due to the competitive prices in the domestic market.

A deal was heard from an Italian electric-arc furnace (EAF) steelmaker at €495 ($583) per tonne cfr Italy on November 17. The cost of freight was about $32-33 per tonne from Turkey to Italy - equivalent to about $550 per tonne fob.

The weekly price assessment for Turkish HRC exports was $540-550 per tonne fob on December 1, same level as November 3.

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