GLOBAL BILLET WRAP: Prices start to stabilise after month of gains

Prices for billet have started to stabilise in some regional markets around the world following a four-week rally fuelled by rising import scrap prices in Turkey and firm demand for long steel in China.

Deep-sea scrap prices in Turkey were stable for most of last week, however, while Chinese billet producers have been facing stagnant prices for their material.

China
In the world’s biggest steel market, rebar prices rose very close to those for hot rolled coil (HRC) last week.

Since prices for the long product are typically 200-300 yuan ($29-44) per tonne lower than those for flat steel due to their production cost differences, market participants are expecting rebar prices to fall soon as the gap returns to its typical size.

Any fall in rebar prices in China will immediately affect the local billet market, which in turn would translate into lower export prices for the product, market participants said.

Asia
In Southeast Asia, a series of bookings of India-origin billet two weeks ago brought activity last week to countries such as Indonesia, Thailand and the Philippines.

Indian billet was heard sold around $425 per tonne cfr in both Thailand and Indonesia, while in the Philippines deals were concluded at $440-443 per tonne cfr.

New offers for material from India and other origins were no less than $435-440 per tonne cfr in Indonesia, but by the end of the week there was news of Russia-origin billet booked at $430 per tonne cfr, sources said.

And in Thailand, most customers were still submitting bids at only $415 per tonne cfr – prices that at the moment can only be met by Iranian suppliers.

CIS, Mena
Metal Bulletin’s weekly price assessment for CIS billet exports, meanwhile, narrowed upward to $385-400 per tonne fob Black Sea early last week, with offers heard above $400 per tonne fob.

Export prices from Turkey were stable, even though domestic prices for the semi-finished product moved up in tandem with stronger scrap prices.

“The billet prices are rising as the producers are trying to increase their offers in line with scrap costs,” a Turkish source said.

“I think the market will remain firm, with tight billet supply and firm scrap prices,” another source added.

In Egypt and the UAE, prices moved slightly up, but demand was described as weak.

Metal Bulletin’s price assessment for billet imports into Egypt was $405-410 per tonne cfr, up from $400-405 per tonne cfr, while in the UAE the assessment widened upward to $390-398 per tonne cfr from $390-395 per tonne cfr.
 

 
This article was originally published on Friday March 3.