CIS-based billet suppliers have enjoyed better demand this week as customers from the MENA region have been looking to conclude purchases. Deal prices have increased and the outlook is positive for the near future. However, competition with Turkish sellers has also strengthened.
Deals, signed mostly early this week, have been heard at $385-390/mt FOB. There have been reports of inquiries and sales to North Africa (Tunisia, Algeria), Latin America, Turkey and the GCC, SteelOrbis has learned. Moreover, some contracts have been already closed above $390/mt FOB, though most market sources have said these were mostly exceptions. For example, a deal for about 10,000-15,000 mt of ex-CIS billet to Algeria has been signed at above $430/mt CFR (which corresponds to above $400/mt FOB), but the deal was done with special financial conditions. Also, 10,000 mt of ex-Ukraine billet has been sold at $395/mt FOB to North Africa. About 10,000 mt of ex-Ukraine billet from the Azov Sea has been traded at $388/mt FOB for March shipment, according to a source, familiar with the deal. Some other sources believe that it was at a somewhat lower level.
Late this week, major CIS mills have started to offer at $400/mt FOB for April shipment and above, sources said, while the lowest possible level has been $395/mt FOB. The further increase in scrap prices supports the billet uptrend.
At the same time, Turkish sellers have also been active in the billet export market and have managed to sell more than 150,000 mt over the past two weeks.
Higher demand for import billet (both ex-CIS and ex-Turkey origin) in the MENA region has appeared, because buyers were mostly cautious in purchases when scrap prices were falling, as a result, which created some differences in demand.
In Asia, trading activity has been somewhat limited. The latest sale from the supplier from Russia’s Far East has been heard at $425/mt CFR Philippines, which is equivalent to about $410/mt FOB or slightly lower. There has been no price improvement in this destination so far, taking into account cheap positions cargoes of Southeast Asian origin billet.
The SteelOrbis daily reference price for ex-CIS billet has remained at $390/mt FOB Black Sea. This level is $10/mt above last week.
