Last week, demand for imported billet in China was relatively weak and customers preferred to buy at as low as possible prices. This week, slight increases have been registered in bid prices and overall sentiment has improved, supported by higher rebar futures prices in China.
Over the past week, ex-Vietnam induction billet has been traded at $398/mt CFR China, which corresponds to $390/mt CFR for non-Vietnamese material, taking into account zero import duty on Southeast Asian billet in China. Such a low price level is connected with the fact that “Chinese customers don’t like induction billets,” a Chinese trading source said.
Also, a deal for Iranian billet has been heard at $400/mt CFR or slightly below, Asian sources said.
Last week, bid prices for non-Southeast Asian and non-Iranian billet were at below $400/mt CFR, but at the moment sentiment has improved a bit. A few traders have said that the workable level has to be “around $400/mt CFR China” now. There has been information in the market about negotiations for ex-Vietnam BF billet at $410/mt CFR China, which is equivalent to about $402/mt CFR for non-Southeast Asia material, but the final deal price has not been confirmed by the time of publication.
Some improvement has been linked to the still relatively strong rebar and billet prices in the local Chinese market. Today, July 7, billet prices in Tangshan have increased by RMB 20/mt to RMB 3,350/mt ($476.5/mt) ex-works, including 13 percent VAT, amid steel production restrictions in Tangshan.
The increase in bid prices for imported billet in China is partly connected also with higher futures prices. Rebar futures at Shanghai Future Exchange added RMB 19/mt ($2.7/mt) today and are up RMB 68/mt ($9.7/mt) since July 1, to RMB 3,634/mt ($517/mt).
