Large CIS-based billet exporters have increased their prices sharply on Thursday, April 29, as the tradable value for sales to China has increased after the announcement of the two percent import duty for non-ASEAN billet being cut to zero.
Most large steel mills from the CIS have started to ask $620/mt FOB Black Sea as with the freight of up to $60/mt this level corresponds to $680/mt on CFR basis to China. The latest tradable value for non-ASEAN billet in China has already reached $675/mt CFR, according to sources. “Who will sell lower if there is this price in China?” a representative of one of the CIS-based producers said.
Late last week, a contract for 60,000 mt of ex-Ukraine billet was done at $605/mt FOB, which is about $655-660/mt CFR China, taking into account the slightly lower freight due to the large volume.
Other outlets have been out of the range of interest of the CIS exporters as the bids in question are much lower. Some contracts are still possible to Latin America, but time is needed for buyers to evaluate the market. No deals have been reported to the Mediterranean.
Turkey’s import billet market remains a low-priced one for most large CIS-based suppliers and so it is mainly absent from their focus. By the end of the week, the key producers have withdrawn their offers to Turkey, shifting their attention to the Chinese market with $610-620/mt FOB. In the meantime, billet originating from the east of Ukraine has been on offer to Turkey at $600/mt CFR, versus $595/mt CFR in bids. Small Russian suppliers have been offering $610-615/mt CFR, up $10-15/mt over the past week. “I bet we will not see offers from the big boys in Turkey in the near future, at least reasonable offers. Only those who sell in small lots are bound to sell to Turkey,” a trader told SteelOrbis.
The SteelOrbis reference price for ex-CIS billet risen by $15/mt today, April 29, to $610-620/mt FOB.