Ex-China billet export prices have been on the rise this week and, though earlier this week market sources were skeptical, by Wednesday most market sources agree that tradable levels for ex-China billet on FOB-based have increased supported by the number of deals done earlier and rather warm sentiments locally.
The SteelOrbis reference price for ex-China 3SP billet stands at $460-470/mt FOB, increasing by $5/mt from the previous day. At least three large exporters have confirmed that $465-470/mt FOB would be reasonable for sellers right now. One of the main reasons has been the recent success with a number of deals done to Southeast Asia at $475-485/mt CFR for base grade, which translates to $450-460/mt FOB. “Chinese FOB is going up because on CFR basis buyers can pay more,” a Singapore-based trader said. “It is hard to book even at $460/mt FOB now,” another Asian trader said.
In addition, demand in the local Chinese market has been a bit better, though prices have been increasing slowly compared to those seen in the export market. The average local billet price stands at RMB 3,028/mt ($439/mt) ex-warehouse, edging up by just RMB 3/mt ($0.4/mt) from the previous day and up RMB 35/mt ($5/mt) over the past week.
Some Chinese exporters also claimed that, after the recent jump in iron ore prices and recent announcements that the Chinese government will keep controlling steel production, their billet offers are not below $470/mt FOB.
Most offers for Chinese billet in Turkey are at $520/mt CFR with only minimal discounts possible, with such a price fully out of buyers’ range of interest after the previous ex-China deal done at $490/mt CFR.
The Indonesian mill increased its billet offers for April by another $5/mt early this week to $490/mt FOB, while its offers for other products like slabs and wire rod were raised by the same amount.
