CIS-based billet exporters have been insisting on higher prices recently as the large mills have already booked a major part of billet for December shipment and some of them have already started to give offers for January. The tradable value has not changed much over the past week, which has been confirmed in two large-volume bookings.
A Ukrainian producer has sold to a re-roller in Saudi Arabia 50,000 mt of billet at $434-437/mt CFR for December shipment, which translates to $409-410/mt FOB, according to a number of sources, taking into account winter freight rates and a small grade extra. Demand from the GCC is going to continue. Two customers from the UAE have been in negotiations, targeting $400-405/mt FOB. Sources in the market agree that CIS-based mille are unlikely to provide a price below $410/mt FOB, SteelOrbis has learned.
Also, a Russian mill has sold 40,000 mt of billet to the Philippines at $460/mt CFR, which corresponds to $420/mt FOB, according to sources, but some believe that the freight rate is higher and that the FOB price level should be at around $416-417/mt. Nevertheless, this price level has been assessed by all major market participants as too high and not reflecting the current market conditions as the material will be shipped in mid-November. “This is a kind of exception and good luck,” a trader said. Asian customers would accept around $445-450/mt CFR for billet from the Black Sea, which is equivalent to around $405-410/mt FOB, taking into account the lowest possible freight, according to traders.
Most large mills from the CIS have been offering for end of December-January shipment at $415-420/mt FOB, with very few firm offers heard in the market. “This is the period when almost all volumes are sold and bought,” a producer said.
Demand has been very weak in North Africa with no new negotiations in place. Some inquiries are expected from other African buyers and from South America, but not earlier than the end of next week.
SteelOrbis’ reference price for ex-CIS billet has remained at $410-415/mt FOB, stable from last week.