China again interested in billet imports

Thursday, 19 September 2019 15:22:09 (GMT+3)   |   Istanbul

China has come back to the import billet market again, though the sustainability of this trend is questionable.

Two contracts for at least 40,000 mt of billet each from Qatar have been closed to China at above $400/mt CFR for October shipment this week, SteelOrbis has been informed by a number of sources. Negotiations were also held for billets of other origins, including Turkish.

Most market sources have said that this is a good price for both customer and seller as local prices in China are still $10-15/mt higher, when comparing recent transactions at current average local prices excluding VAT and adding taxes for imported semis. The freight cost was not so high for the supplier as the FOB price has been assessed at not lower than $375/mt, according to sources.

New deals to China can be concluded at not above $400/mt CFR, sources believe. But taking into account lower freight rates to China compared to to freights to some other Asian countries, suppliers may be interested in selling.

One of the important reasons for the increased demand for imported billet from China has been the expected production restrictions in the country in October, but it is still unknown how strict restrictions will be in the second half of the month after the celebration of the National Day holiday. China was last active in the import billet segment in July, when there were sales of more than 200,000 mt of semis ex-Qatar and ex-Iran.

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