Hot rolled coils prices have
weakened more in the last ten days, with lowest prices being offered at
$610-620/MT fob Black Sea. The floor price remains at $610/MT, as has been
announced last week, and it doesn't look like it will be going down any
further.
Indeed, considering producers' high costs, the prices are looking to have reached the bottom, some market
experts say. “Even though some of the mills do have their own iron ore,
they have to calculate their costs at market levels, which makes it difficult
to lower their prices any further,” one trader explains.
With general consensus being that
market is at the worst it has been this year, there are talks of mills bringing
maintenance stoppages forward and gently reducing output, although “these are
not drastic measures” he added.
Mill sources generally note that
in the last week there have been more enquiries, with buyers testing the
market, and small deals are being concluded. But real demand continues to be
dull.
The $600/MT fob Black Sea level
still remains a psychological barrier, which is unlikely to be breached,
although the rebound may not happen immediately.
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