GLOBAL BILLET WRAP: Prices fall on slower buying activity

Steel billet prices in most global markets either held steady or continued to weaken during the week from Monday April 23 to Friday April 27 after global trading activity ebbed away amid soft demand.

But prices for long steel products in China and Southeast Asia edged up following China’s slight recovery in the early part of the week.

Chinese domestic billet prices lost their upward momentum on Wednesday, then fell on Thursday and Friday.

Chinese billet was being traded at 3,570 yuan ($565) per tonne including VAT on Friday in Tangshan, down by 10 yuan per tonne from a day earlier.

Billet inventory in Tangshan totaled 570,000 tonnes on Friday, down by 60,000 tonnes from a week before.

Offers of Q235-grade 150mm billet were $530-535 per tonne fob on Friday, the same as a week earlier. But no bids or transactions were heard due to the high offers.

Domestic rebar prices in China also stopped rising on Wednesday because of softer demand, before falling on Thursday amid weaker futures. The previous continual price increases had sent many buyers to the market sidelines, sources said on Tuesday.

Southeast Asia
In Southeast Asia, billet prices picked up some strength last week amid higher offers from China as a result of a recovery in that country’s domestic billet and rebar markets.

Metal Bulletin’s assessment of import prices for billet in Southeast Asia was $540-545 per tonne cfr for the week ended April 23, narrowing upward by $5 per tonne week on week.

But by the end of the week, China’s domestic prices had weakened again, resulting in slightly lower export offers.

Offers of Chinese billet were heard around $550-560 per tonne cfr Asia on Friday, down from $550-565 per tonne cfr a week earlier.

A trader was said to be offering $545 per tonne cfr for a Middle East-origin position cargo during the week. Japanese billet was also in the market, offered at $555 per tonne cfr.

Offers of Taiwanese billet stood at $530-535 per tonne fob, equivalent to about $540-550 per tonne cfr Southeast Asia.

Indonesian buyers did not procure much billet during the week because sales in the country’s downstream markets have been weak since February, sources said.

Indonesia’s demand for imports was further damped by the upcoming Islamic holy month of Ramadan, which will start in mid-May. Restrictions on local transportation will also be implemented in mid-June for the Eid Al-Fitr holiday that marks the end of Ramadan.

In the Philippines, buyers were not rushing to buy because they have enough billet in their inventories to last for as much as two more months, market participants said.

And the monsoon season in the archipelago will start in June, during which demand is expected to slow down further, traders in the region said.

In the Commonwealth of Independent States, the export billet market had a quiet week, with thin buying activity due to the mismatch between offers and bids.

Most mills continued to offer billet at $510-515 per tonne fob Black Sea, while official offers from Ukraine’s ArcelorMittal Kryvyi Rih were reported at $520-530 per tonne fob Black Sea.

But buyers were bidding only $500-505 per tonne fob.

The market is in “standby mode,” a source said.

A large cargo of Belarus-origin billet was heard booked for around $505 per tonne fob. And one buyer in Turkey was said to have placed an order at $522 per tonne cfr, equivalent to $507 per tonne fob Black Sea.

No other deals were reported during the week because markets participants were seeking clearer price directions.

Falling scrap import prices in Turkey put further pressure on CIS suppliers, with customers and traders also expecting billet prices to move downward.

CIS export billet prices continued to slide in the week ended April 23 on lower-priced bookings.

In response to the billet downtrend and Turkey’s falling scrap import prices, CIS rebar suppliers also lowered their prices during the week ended April 23.

Iran, Middle East
In Iran, export prices for semi-finished steel product remained unchanged in the week ended April 25, with buying activity slowing.

Iranian mills offered May-June output billet at $500-510 per tonne fob, but bids came in at $495-500 per tonne fob.

A cargo of Iranian billet was heard booked in the United Arab Emirates at $525 per tonne cfr, equivalent to $500-505 per tonne fob.

In the UAE and Saudi Arabia, import prices for billet and rebar were also stable, although demand was subdued, sources told Metal Bulletin on April 24.

Iranian billet offers were heard at $530 per tonne cfr, and a deal was done at $525 per tonne cfr for 5,000 tonnes, participants said.

Meanwhile, demand for imported rebar in both the UAE and Saudi Arabia remained almost non-existent, and no new prices were heard.

Jessica Zong in Shanghai, Vlada Novokreshchenova in Dnepr, Serife Durmus in Bursa, and Cem Turken in Mugla contributed to this report.