Export prices for Russian semi-finished products continued to fall

Russian slabs compete with Chinese HRC in Turkish market

Export prices for Russian semi-finished products fell again at the end of last week due to weak demand from foreign buyers. Kallanish informs about it with the reference to market participants.

The billet price was $555-570/t FOB Black Sea compared to $580-590/t a week earlier. Export prices for slabs from the CIS at the end of last week were $600-615/t FOB (compared to $620-670/t on March 22). At the same time, the devaluation of the ruble offset the impact on suppliers from lower export quotations.

Importers expected further reduction in prices for Russian semi-finished products. In addition, in the Turkish market, slab producers from the Russian Federation faced strong competition, and not from alternative suppliers, but from Chinese exporters of hot-rolled coil (HRC).

Chinese HRC suppliers set aggressive prices. In turn, this allowed Turkish buyers to demand big discounts on Russian slabs.

At the end of March, amid the weakening of the Turkish flat steel market, Russian suppliers of slabs (Black Sea/Baltic) had to adjust prices. At the same time, billet quotations in Turkiye are also falling, as demand on this market remains moderate, in particular, due to the lack of fresh scrap prices.

As GMK Center reported earlier, in 2022 amid sanctions after a full-scale invasion of Ukraine, the production of steel products, domestic demand and export sales of the Russian Federation fell. However, this reduction was less than expected by the markets. The volume of Russian steel exports remained significant despite sanctions restrictions, mainly due to demand among countries that did not introduce them and the absence of a ban on the import of Russian semi-finished products to the EU.

Russian exporters have lost part of their traditional markets. At the same time, prices for steel products from the Russian Federation were lower than from other countries, which made them more attractive to buyers.