GLOBAL BILLET WRAP: Global billet prices rise, as most of the customers accept higher prices
Global billet prices for steel slab have mostly risen this week, as suppliers in the CIS region managed to push through an increase and concluded several deals at higher prices.
Meanwhile, customers in Turkey were showing little buying interest at higher prices, because they were still struggling to sell rebar to their export markets.
Billet prices were 3,890 yuan ($588) per tonne including VAT in Tangshan at 3pm on Friday December 1, up by 40 yuan per tonne from a week ago.
The volume of inventory in Tangshan’s major warehouses and port was 270,000 tonnes on Friday, down by 50,000 tonnes from a week ago, Metal Bulletin has learnt.
Billet import prices in Southeast Asia have rebounded over the past week with more buying interest, while suppliers withdrew low offers in the expectation of further price gains.
Steel mills had initially offered cargoes at the previous week’s prices, but withdrew them from the spot market toward the end of the week when downstream rebar prices rose in the Asian physical and futures markets.
Cargoes from the Middle East and the CIS region were being offered in the spot market at $500 per tonne cfr into Southeast Asia, but end-users were looking for cargoes at $485-495 per tonne cfr Southeast Asia.
Market participants said that $495-500 per tonne cfr Southeast Asia was a workable price range.
Fundamental demand from downstream re-rollers increased as they looked to secure cargoes in anticipation of higher prices in the coming weeks.
“End-users had already bid as much as $495 per tonne cfr Southeast Asia. It depends on whether any sellers will offload cargoes at these prices,” a trader based in Southeast Asia said.
Sentiment in the spot market has been boosted by rising domestic prices in China’s long steel markets, mainly due to the government-stipulated production cuts and an increase in downstream construction activity after the recent 19th National Congress of the Communist Party of China.
CIS, Turkey, Egypt
CIS billet export prices have continued to climb, with most mills closing their December orders this week.
A 10,000-tonne billet cargo was sold into Egypt at $495 per tonne cfr while the freight rate for the cargo was around $20 per tonne.
Traders then sold several more 10,000-tonne cargoes to Egypt at $500-505 per tonne cfr. This pushed offers from the CIS region to $480-485 per tonne fob Black Sea.
Meanwhile, Turkish customers were not ready to accept prices higher than $485 per tonne cfr. Several cargoes were heard booked within the range of $480-485 per tonne cfr with the cost of freight to the destination at $15-20 per tonne.
Later in the week, another 10,000-tonne billet cargo was heard sold by another CIS mill to a trader for position, at a price equivalent to $485 per tonne fob Black Sea.
Turkish imported billet prices have increased slightly in line with the rising scrap import values, while the domestic and export prices have been comparatively stable.
Suppliers in the CIS region were heard raising their offers to $485-490 per tonne cfr, from $480-485 per tonne earlier in the week.
However, demand for the material was not strong yet, as the mills in the country were still focusing on scrap.
Steel billet import prices in Egypt have increased over the past week and several deals have been heard.
Billet offers from the CIS region were varying within the range of $505-515 per tonne cfr.
Meanwhile, Iranian mills were offering billet at $485-490 per tonne cfr to the United Arab Emirates, and a producer in one of the Gulf Co-operation Council (GCC) countries was offering the material at $490 per tonne cfr UAE.