The first day after the short holiday in China has been rather negative for the country’s markets, with steel futures prices down significantly, iron ore prices sliding below the $100/mt CFR mark and the billet export market suffering setbacks. The recent deepening of trade tensions between the US, China and other countries has impacted sentiments a lot, while it has offset the traditional spring demand rebound, at least for now.
The ex-China billet reference price has settled at $420-435/mt FOB with the midpoint at $427/mt FOB, sliding by $10/mt since the previous working day on Thursday, April 4. Most offers have been at $430-435/mt FOB, but in the current conditions discounts of at least $5/mt can easily be found, sources have said. Though overall demand for rebar and billet in the local Chinese market has been assessed as rather stable, a Chinese trader noted, “It is a panic fall we can see in the paper market and there is a concern that a trade war will influence everyone’s life even more. Different governments will have different actions on the USA tariff plan, and then when the compromise is found we may see some good news.”
An Indonesian billet exporter has lowered its offers for billet and slabs by $5/mt today, to $435/mt FOB and $455/mt FOB, respectively. “They had almost no sales for around 10 days, so they give the same price as China can give and hope to push June shipments,” a Southeast Asian trader said.