UK based MEPS said that CIS steelmakers are divided over the date of any reversal in the downward trend. Tonnages designated for overseas sales remain limited. Buying sentiment is not expected to significantly improve. CIS traders, operating in Black Sea and Caspian Sea ports, are resisting calls for lower billet quotations, since they do not think it would reinvigorate buying activity.

Domestic billet selling figures in Turkey declined by 7.5% in June 2012. Business confidence has been unsettled by weak deliveries to downstream steel consuming industries and the ongoing EU sovereign debt crisis. Pressure is mounting on the integrated mills to instigate production cuts. Local traders plan to purchase material only to service immediate requirement until trading conditions improve. Procurement is being held back by fears that domestic selling figures will continue to move downwards in the short-term, at a slower rate though. The price differential between domestic and imported billet is now negligible.

Challenging business conditions persist in the United Arab Emirates. Emirati re rollers are finding it difficult to obtain satisfactory prices for their wire rod and reinforcing bar, due to low import quotations and an uncertain economic climate. Steel demand from the construction sector has continued to fall short of industry expectations. The close proximity of the summer holiday season and Ramadan has also unsettled trading volumes. Price support from other global markets remains limited.

The outlook for the Iranian market remains uncertain. Local re-rollers are only purchasing small volumes at any one time. However, it is still difficult to finance purchases, due to the international banking sanctions against the country and tight domestic credit conditions. CIS material is subject to a 4% import duty.

Source - MEPS - Semi Finished Steel Review

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