Almost all major sales destinations which are traditional for CIS-based billet exporters have been very week in terms of both demand and prices, and so exporting mills have still been focusing on the Chinese market. Though most importers there have taken a step back from purchases and no fresh bookings have been done, this market has been the only one considered by CIS-based suppliers as “good for sales,” SteelOrbis has learned.
Offers from Ukraine to China have been heard at $605-610/mt FOB this week, down from $610-620/mt FOB sought late last week. This means that suppliers have been considering China as the most attractive sales destination for now, even after the easing of sentiments there. Early this month, a cargo of 50,000 mt was sold at $605-610/mt FOB Black Sea to China.
With the freight from the Black Sea to China, including all expenses for vessels waiting at Chinese ports, still assessed at up to $100/mt, the current offer level is $705-710/mt CFR. “China has backed off now and people are not interested in buying,” a trader said. “We are checking the CIS and Turkish [export] prices, but futures fell much today again,” an Asian trading source said.
Rebar futures at Shanghai Futures Exchange have dropped by 2.2 percent today to RMB 5,478/mt, while local billet prices in Tangshan have decreased by RMB 30/mt ($5/mt) today to RMB 5,210/mt ($807/mt) ex-works, which corresponds to $714/mt, excluding 13 percent VAT.
Large suppliers from the CIS are going to wait for Chinese buyers to come back after the holiday on next Monday and Tuesday, as the situation in most other markets is even worse. Latin American customers have not been showing much interest and this market has been described by most sources as “slow” for now.
The Turkish market has been not attractive for CIS sellers at all as importers have been bidding at $605/mt CFR, which could be considered only by traders who have positions in hand and sell only small lots.
The SteelOrbis daily reference price has remained firm on average today compared to yesterday at $600/mt FOB, down by $7.5/mt week on week.