The CIS hot rolled coil export prices increased some more last week amid a total sell out of July production volumes earmarked for export by Russian mills. There are small volumes reserved for the domestic market, so some relatively small tonnages may become available later on, but they will not be significant, market sources tell Kallanish.

Despite Asia being the driver of the increase, which has now spread to Turkish HRC also, a slight softening of China's futures prices on Friday has been largely ignored by the traders. They remain confident in Chinese buyers commitment to booked volumes, and expect demand to continue, while continuing negotiations with mills. Vietnam's prices, which rose to around $430-435/t cfr this past week, are also providing more opportunities for both CIS and Turkish mills without any compromise on prices.

But sellers are moving their prices in line with the market, and increasing offers almost daily, although these levels are now hypothetical, as lead times are becoming too long again. A minimum price available for basic S235 grade HRC is now $400/t fob Black Sea, while re-rolling grades and heavy/wide coils are offered at up to $430/t fob. 

Turkey has pulled out of the import market as it digests domestic sentiment change, accompanied by higher domestic prices, and having booked plenty of low priced European material. It is likely that in the case of extra availability from July rolling books appearing towards the end of the month, some of these volumes will be directed to Turkey, having the attraction of short lead times. Besides, Ukrainian material from July rolling is still available at $415-425/ cfr, depending on the grade and volume, and already much below domestic Turkish prices (see separate article).