Square billet buyers in the Gulf Cooperation Council (GCC) have been reporting increased offers since the beginning of the month, especially offers from Iran. According to sources, Iranian suppliers have been selling heavily to Asia, China and to the GCC during past weeks, and so have decided to increase their prices for the coming round of bookings. Another factor is the recent upturn in the scrap segment, although the trend may be reversed soon.
According to sources, the most recent ex-Iran offers for billet have been settled in the GCC at a minimum of $530/mt CFR, while some buyers have been receiving $540/mt CFR offers. The previous level was at $475-480/mt CFR in offers and deals. Specifically, an Oman-based steel producer booked 50,000 mt of Iranian billets earlier in August at $475/mt CFR. According to sources, there have been new orders from Oman at up to $500/mt CFR in bids, but Iranian sellers did not accept this level. In return, in the domestic GCC billet market ex-Oman offers are estimated at $550-560/mt CPT to the UAE.
Despite the price increase, the market sources doubt the higher billet levels will find wide acceptance in the GCC market, particularly among re-rollers and small producers. The rebar trade is expected to pick up not earlier than late September, and so no serious billet bookings are expected in the coming weeks.