Billet suppliers in the Black Sea region of the CIS, experiencing a temporary weakening of trade to China and Southeast Asia and estimating the impact of the freight increase for August-September shipments, have been looking to sell to nearer destinations. As a result, a large tonnage was traded to the Gulf Cooperation Council (GCC) region with the price indicating a decline from the previous benchmark.
This week, two square billet cargoes from Ukraine were traded to a buyer from the GCC at around $360/mt FOB base, corresponding to $390/mt CFR, for 3sp grade. The total tonnage is said to be 100,000 mt and it will be shipped within August, SteelOrbis has learned. In addition, some interest has been seen in Turkey. One mill has purchased a trader’s 30,000 mt billet cargo for August shipment at around $370/mt CFR Iskenderun, which is estimated at slightly below $360/mt FOB, sources said. The general range of ex-CIS offers to Turkey has been reported at $380-385/mt CFR this week. With the mentioned deals, the SteelOrbis daily price for ex-CIS billet has declined to $358-362/mt FOB, from $365-370/mt FOB seen earlier this week.
The latest sales of billet to Asia were at $405-407/mt CFR to Indonesia from Ukraine in mid-June with the freight at slightly above $30/mt. At the moment, “the workable level [in China] is still below $400/mt CFR,” a trader said, evaluating the possible deal level after the holidays for big volumes. Another trader reported bids at $400/mt CFR on Wednesday, the last working day before the holiday. Taking into account higher freight rates in August-September, this level translates to $360/mt FOB. In Southeast Asia, there has been no report of big-volume inquiries as customers have already purchased needed volumes and are waiting for an improvement in the long steel products market.