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CIS billet's tentative recovery on pause as buying halts - 9 March 2012

The tentative recovery of billet prices which started to take shape at the end of last month has come to a halt; buyers withdrew from the market after seeing CIS billet prices gain $20/tonne last week. Today, enquiries are less and bids even sparser, a trader tells Steel Business Briefing, with the majority saying that, whilst one can still find buyers at $600/t fob Black Sea, there is no business for traders in such deals.

"Very odd market," a major trader says. Sentiment turned passively-negative in the last couple of days, he says, as the lack of interest and bids from buyers is matched by seeming indifference from the producers. "When there is a wait-and-see situation, at least you get a lot of enquiries from the buyers, which indicate to the producers that if they persist in sticking to their offers they will get a deal a few days later; but now it’s just quiet on both sides," he says.

Demand is said to be coming only from Italy and Tunisia right now, but it is very low, whilst Egypt is said to be "not interested". In theory one could sell a lot at $595/t fob Black Sea, another trader says, but in today's bearish market, mills coming out with such offers could indicate further falls, so buyers could still not be tempted, he explains. BMZ is said to be still in the market at $615/t fob Black Sea with prepayment, sources say.

OEMK might be offering at $600-605/t fob Black Sea, but this could not be confirmed with the producer, whilst Mechel is still not in the market. With ISD's billet sold up to May and Metinvest almost closed its April books, the availability is moderate, with no pressure on producers to sell, sources say.

 

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