CIS-based billet exporters prepare for further price hike amid higher Chinese bids

Monday, 26 April 2021 17:52:22 (GMT+3)   |   Istanbul
       

CIS-based billet exporters have been preparing for further price hikes, even though the workable levels are still low in the Mediterranean market. Rising bids from Chinese customers have provided support for ex-CIS billet prices.

A number of large CIS-based producers have been in negotiations with Chinese billet importers since last week. A large ex-Ukraine cargo is rumored to have already been sold to China. Though the final price in the deal is not clear by the time of publication, the tradable level on Friday was assessed at $655/mt CFR China for ex-CIS billet. A trader sold the latest ex-India cargo to China at $652/mt CFR on Friday, up by $4/mt from the previous deal for billet of the same origin earlier last week.

Nevertheless, on Monday firm bids for non-ASEAN billet from China have already started to come at $660/mt CFR, a number of market sources have confirmed. This level corresponds to $600-605/mt FOB, based on different freight rates estimations from the Black Sea to China. The hike in bids in China has been triggered by the latest jump in futures price and the increase in local billet prices. On April 26, rebar futures have been closed at RMB 5,371/mt ($828/mt) at Shanghai Futures Exchange, up by 2.34 percent or RMB 123/mt ($19/mt) compared to the previous trading day.

High demand for steel products in China as well as production cuts are expected to keep the Chinese billet market strong in the near future, and so foreign billet suppliers are bullish. Some offers for ex-CIS billet have been reported at $670/mt CFR and up to $675/mt CFR to China.  

“Even if China does not buy from the Black Sea, it buys from everywhere, and so it will help prices in different regions,” a market source said. According to the previous reports, deals for billet from Turkey, the GCC and Russia’s Far East region have been done at $645-650/mt CFR over the past ten days.

Limited offers for the local billet have also started to push up prices in the Turkish market. Bids for the import billet in Izmir have increased to $600/mt CFR since late last week. This is still too low for most CIS-based suppliers, but if prices reach about $615-620/mt CFR sales may resume.

The latest deal for Latin America was done for 10,000 mt of ex-Russia billet at about $670/mt CFR last week, which is assessed at $600/mt on FOB basis or so. Prior to this, a lot of 30,000 mt of ex-Ukraine billet was also traded at about $600/mt FOB base. Some enquiries for volumes are still in the market from Latin America.

The SteelOrbis reference prices for ex-CIS billet have increased to $595-605/mt FOB with the mid-point at $600/mt FOB, up by $5/mt on average compared to the level on Friday, April 23.


Tags: Billet Semis CIS 

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