The proposal is in line with China’s evolving steel market, where billet imports are expected to be a trend as a result of the country’s drive toward cutting blast furnace capacity and crude steel output.

China is increasingly becoming an important billet importer in Asia, along with the Philippines.

China imported 8.45 million tonnes of steel billet in January-October 2020, according to Chinese customs data. The country imported just 482,393 tonnes in the same period of 2019.

The price will be assessed on a cfr eastern China ports basis. Price points for other mainland China ports obtained directly from active market participants will be normalized to a cfr eastern China basis.

Fastmarkets’ weekly assessment will exclude prices for Iran-origin billet due to such cargoes carrying steep discounts in comparison with blast furnace-based billet supplied by other countries such as Vietnam, India and Russia.

Fastmarkets will not normalize price information for cargoes of quality and sizes beyond what is outlined in the established specifications to arrive at an assessment. While it may take such information - such as those concerning the cfr Philippines market and ferrous scrap prices - as supplementary data, the assessment will be based on primary data gathered on a cfr China basis.

The specifications for the proposed assessment are as follows:

Steel billet, import, cfr China, $/tonne
Quality: 120x120mm to 150x150mm, length 12m, 3sp grade
Quantity: 5,000-50,000 tonnes
Location: cfr eastern China ports (normalized for other mainland Chinese sea ports)
Timing: 4-8 weeks
Unit: $/tonne
Payment terms: Letter of credit on sight
Publication: Weekly, Friday, 5-6pm Shanghai time

The consultation period for the proposed price starts on Wednesday January 6 and will end on Friday February 5. The proposed changes, subject to market feedback, will be implemented on Monday February 8.

To provide feedback on the proposed amendments to the specification, or if you would like to provide price information by becoming a data submitter to Fastmarkets’ steel billet pricing, please contact Jessica Zong or Lee Allen by email at: pricing@fastmarkets.com. Please add the subject heading “FAO: Jessica Zong / Lee Allen, re: China steel billet price.”

To see all of Fastmarkets’ pricing methodology and specification documents, go to https://www.fastmarkets.com/about-us/methodology.