The price level for ex-CIS billet has softened this week as sentiment in the local market in Turkey has weakened and a large number of cargoes redirected from China are still available. In such a situation, some CIS-based sellers have been looking for sales to North Africa or some other markets, unwilling to drop their prices sharply.
A cargo of 20,000 mt of ex-Ukraine billet has been traded to Libya at $715/mt CFR with the FOB Black Sea level assessed by market sources at $655-660/mt. In addition, there has been a bid for 10,000 mt of ex-CIS billet, also from North Africa, at $705/mt CFR, but there has been no information about the signing of a deal.
There has been a lack of firm offers from CIS-based mills this week. Some of them are still out of the market, not announcing any official offers and waiting for a clearer situation from November. Some producers are evaluating the market at $660/mt FOB or slightly below, but they are also cautious, seeing the worsening of the sentiment in Turkey, which was the main driving force for prices recently.
According to market sources, there are still plenty of cargoes offered by traders to Turkey, which were initially targeted for China. “There are offers [for billet originating] from the Gulf, India and even Brazil,” a market source said.
The import billet market in Turkey has been in wait-and-see mode this week, taking into account the approaching holiday. Buyers are not in a rush to negotiate, knowing that the situation in China somewhat destabilizes the positions of the CIS-based billet exporters. The import offer range in Turkey is currently settled in a wide range from $680-700/mt CFR from Asian traders for the cargoes earlier destined for China, to $710-725/mt CFR seen in the indications from the large CIS-based suppliers. Bids for the large volumes hardly exceed $700-705/mt CFR and are around $20/mt lower for small lots for prompt shipments.
Though fears of the cancelation of contracts for billet in China still exist, there have been no confirmation of this for cargoes originating from the CIS and sold to China in September. “I believe that CIS exporters will not allow this,” a selling source said.
Since the situation in Asia has worsened further, there have been no fresh offers for billet from Russia’s Far East region to Southeast Asia or China. “We can wait as we have a lack of December production allocation left,” a supplier said. Bids from Southeast Asia have fallen to $675/mt CFR as the highest today after a further drop in China.
The SteelOrbis reference price for ex-CIS billet has dropped to $655-660/mt FOB, down by $12.5/mt on average since late last week.