Ex-CIS billet export offers have remained relatively stable over the past week despite increased downward pressure.
Square billet from first-tier CIS exporters has been available within the $410-415/mt FOB range for September production, being in line with last week’s workable levels. Buyers generally will not accept to deal at higher than $400-405/mt FOB, citing weaker scrap tags and the fall of iron ore prices. Business activity in the billet segment has been low as the key consuming destination – the MENA region - is about to enter the holiday period.
Therefore, suppliers are not in a rush to provide discounts, aiming to evaluate the situation once their customers are back in the market. “The demand is not enough, but supply is not excessive either today,” a market source told SteelOrbis. “Some mills might be silently giving $405/mt FOB and below, but this price is definitely not widespread in the market today,” a trader believes.
While the MENA region will be out of the market for the holiday, the possibility for the CIS to deal from the Black Sea to Southeast Asia is also scarce. The most recent workable price in Southeast Asia has been $445/t CFR which corresponds to a level not higher than $405/mt FOB Black Sea. In addition, currently Asian buyers are reluctant to deal for large billet volumes in a falling market, SteelOrbis understands.
