Metinvest steel prices rise for some products

Ukraine FOB prices for the types of steel products
exported by Metinvest (METINV), Ukraine’s largest producer, increased
selectively during July 3-10, according to Metal Expert, an industry
consultancy.

 

Prices for billets were flat w/w, and pig iron prices
were not updated for July 10.

 

Slab prices jumped 3% w/w to USD 380/t on July 10, 13%
above their 2019 low of USD 335/t on Nov. 1 and 10% below their 1Q20 high of
USD 420/t on Jan. 17.

 

HRC inched up 1% w/w to USD 410/t on July 10, 12%
above their 2019 low of USD 365/t on Oct. 25 and 14% below their 1Q20 high of
USD 478/t on Feb. 21.

 

The prices provided by Metal Expert are sophisticated
estimates but they are not necessarily the same as the prices realized by
Metinvest for its specific products.

 

Ukrainian steel prices continue benefiting from Asian
(particularly, Chinese) demand, Metal Expert said. Slab supply for August and
September production is limited due to planned repairs at Ukrainian assets,
which was one of the factors for the weekly increase in slab prices, according
to Metal Expert.

 

Dmytro Khoroshun: Ukraine’s
FOB iron and steel prices rebounded 12-19% in May-July after dropping 20-25%
from late March to early May. Therefore, we expect the monthly EBITDA of
Metinvest’s metallurgical segment (including JVs) to drop in May-July from
March’s USD 108 mln and likely below April’s USD 64 mln, but then to stabilize
and possibly rebound in August-September.

 

However, the strong iron ore prices at the global
markets, which were one of the reasons for the recent rebound in iron and steel
prices, will keep the profitability of Metinvest’s metallurgical division
subdued throughout 3Q20.

 

We maintain our negative view on METINV bonds.