The major markets of metallurgical products there is a revival, – UPE

На основных рынках метпродукции наблюдается оживление, - УПЭ

By the end of may in regional markets producers of intermediate was a revival, which allowed to increase the average prices in comparison with April at $2-8, the press service of the SE “ukrpromvneshekspertiza”

After a positive trend of increased demand and rising prices in the first three weeks of may the domestic price of billet in China by the end of the month decreased by $7 to $456-475/t exw, with 13% VAT. The decrease was affected by the drop in prices in the futures market, as well as fears traders the possible excess of imported billets, the volumes of which during the may – July can be up to 2 million tons.

A more sustainable demand for imported markets of Southeast Asia, where prices range between $380-405/t cfr, which is $10 higher than the previous week. The interest of buyers is obvious, however, suggestions are limited to $390/MT cfr. Remain the most competitive offers from Iran at $350-355/MT fob ($380-385/t cfr) shipping in August. On the wave of recovery in demand, some providers are testing the market offers $360/t fob and above. On the import markets of MENA deals rose to $370-385/MT cfr due to the increase in the minimum price of $10.

In the domestic market of Turkey billet prices for the second consecutive week remained $370-380/t exw. On the import market quotations of billet from the CIS rose to $365-375/tonne cfr due to the increase of the upper level for $5. Export destinations of Turkish suppliers offers rose $5 to $365-375/MT fob.

Analysts “Ukrainian industrial export examination” predict a gradual recovery in demand, helped by the expected rise in the cost of scrap. The limiting factor will be a wait and see attitude of customers in the expectation of improving the situation in the markets of finished products. Under these conditions, a predominantly sideways trend is the most probable scenario at the beginning of June.

Despite the decline in demand and shutdown of the project during the period of quarantine, the price of rebar managed to keep from falling, and the average monthly prices for wire rod in the markets of Turkey and South-East Asia managed to raise $8-12.

In the last week of may, domestic prices for rebar and wire rod in China declined by $8-9 to $521/t exw and $532/MT exw C13% VAT. The reason for the decline in trading activity – the fall in the futures market. A negative impact on the market have high inventories of rebar and wire rod traders. The current volumes of material are 12,884 million tons, which is 68% higher than last year’s level. At the same time production is growing, and the average daily steel output during the second decade increased to 2,759 million tons/day, which is 4.8% above the April figure. Another negative factor influencing the demand – the approach of the rainy season in southern China.

Export destinations develops the opposite situation, the offer of the Chinese companies grew within the week by $20 to $440-450/t fob for rebar and $frequencies 425-450/t fob for wire rod. Southeast Asian importers are reluctant to place orders because of the impossibility in the near future to restore efficient operation in the construction industry refers to lack of manpower and the continuing strict requirements in the workplace. The limiting factor are relatively high inventories in the current decline of consumption. According to the expectations of market participants, the recovery of the construction sector and growth can be expected no earlier than Aug.

MENA buyers are still not active. Fittings on import markets are available at $400-415/MT cfr, which is on average only $2.5 higher than a week earlier.

The Turkish market rebar and wire rod demonstrates the revival of demand and the resumption of growth in prices for scrap. Domestic rebar prices in the last week of may was up $5-6 to $406-416/t exw, wire rod rose by an average of $2.5 to $425-435/MT exw. With the support of the growth in scrap prices, Turkish exporters of rebar to the end of may have raised proposals for the rebar at $510 to $405-410/t fob.

Under pressure of weak demand remain the markets of long products in the US and the EU, where prices for long products show mostly sideways trend.

According to analysts of UPE, reduction of consumption and weak trade activity in the conditions of uncertain forecasts to overcome the coronavirus and the recovery in demand will lead mostly a sideways trend in the market of long products in June-July in most regions.