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Export prices for flats from CIS edge higher - 14 Dec 10

CIS exporters of flats are eagerly strengthening their position in foreign markets. In view of higher raw materials costs, suppliers of Russian and Ukrainian products start offering January production one by one and shock buyers with their optimism, as prices are too high for almost all markets.  Besides, demand has not reportedly improved so far, so exporters will hardly be able to fully implement the announced increase.
In particular, Russia’s Severstal set initial prices for January rolling of HRC from Baltic ports at $590/t FOB St. Petersburg, which is by $40/t more than a month ago, but has moved up them by a further $10/t later. CR flats offers have increased by $20/t. Export supply of CRC is quite limited though. Besides, buyers’ inquiries are coming mainly from Europe, as well as North and West Africa.
To Iran, quotations of HRC from Severstal, being usually in euro terms, are by EUR 58/t higher than a month ago – EUR 490/t FOB Astrakhan. At the same time, the actual decrease has been about $55/t instead of $76/t (at the exchange rate EUR 1 = $1.32) due to currency fluctuations.  Notably, in view of UN sanctions against Iran, trading companies have now to indicate who will be their end-user, otherwise no deals will be finalized.
 Prices for MMK''s January output to countries, where there are no quotas, have leaped by $50-55/t from the level of those for December production. So, HRC are being offered at $640/t FOB Novorossiysk, and CRC – at $750/t FOB Novorossiysk. There are no offers of MMK to Far Eastern markets now since the ones from regional suppliers are more competitive.
 HRC from MMK to Eastern and Central Europe (in particular, Poland and Slovakia) have gained EUR 45-50/t over the past month and now are available at EUR 510-515/t ($673-680/t) DAP. However, the increase in the US dollar terms has dropped to $36-43/t instead of $59-66/t on currency fluctuations. Besides, export prices for HRC of the steelmaker to Western Europe are quoted at EUR 495/t ($653/t) FOB St. Petersburg and for CRC – at EUR 580/t ($766/t) FOB St. Petersburg.
As for Ukrainian suppliers, initial offer prices for HR coils from Ilyich are about $605-610/t FOB Odessa against $600-610/t FOB last week, a representative of Metinvest International S.A. says. At the same time, buyers claim the supplier is still ready to grant $5-15/t discounts depending on volume. For example, the above material to Syria is available at $615/t C&F (about $590/t FOB), traders report.
 Official export prices for January production of Zaporizhstal have not been released yet. However, traders have started testing markets with HRC offers at $610-620/t FOB Odessa, by an average of $40/t up from those of December production.        

Source: www.metalexpert-group.com
Dec 14, 2010 14:00
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