Chinese traders will keep their focus on billet exports instead of imports in April, according to market sources, as they are seeing demand overseas and prices are reasonable for selling, while trading in the local market is staying rather limited.
The latest offers for 3SP/5SP 150mm billets from China have been reported at $820-830/mt CFR to the Philippines and other Southeast Asian countries. After a sale at $810/mt CFR Manila for 5SP billet last Wednesday, another trade has been discussed at around $815/mt CFR for 10,000-20,000 mt, but this could not be confirmed by the time of publication.
“Interest in exports will remain for the near future… Domestic demand is not good in March, so mills are under pressure to export. Demand [in the local market] will be much better in the second half of the year, then the willingness to export slab and billet will be less,” a Chinese trader said.
Ex-China billet prices have been competitive and could be an option for a number of customers in Asia, who cannot find cheap offers. For instance, some sources said that the tradable level for ex-Indonesia billets is $820/mt CFR, but it is still hard to find firm offers at this level.
“Price are generally holding firm,” an international trader said, adding that customers are not willing to pay much higher levels, at least for now.
There has been information that ex-Russia billets have been available at around $800/mt CFR in Taiwan, but this has not been confirmed, with sources saying that producers are not giving firm offers.
The lowest price has been for ex-Iran billet. A few deals for ex-Iran billet from traders have been done at $770/mt CFR to both Indonesia and Thailand, while some fresh offers have been heard at $780-790/mt CFR this week.
The average ex-warehouse billet prices in China are at RMB 4,813/mt on March 22, up by RMB 68/mt ($11/mt) over the past week, according to SteelOrbis’ data. This level translates to $668/mt excluding 13 percent VAT. The latest increase in the local market has been too small to push for any movement in the import segment. The reference price for import billet in China has remained at $650-670/mt CFR. “For the longer term, we will see the change of the trend from exports back to imports as the Chinese government has a future carbon policy,” a source from China said. Another trader added that, even if demand gradually recovers in the local Chinese market, it will take a long time for prices to recover to the levels seen in the international market.
$1 = RMB 6.376