Billet prices have continued to go up in the local Chinese market, which has provided support for import billet prices. Fresh deals have been signed at higher levels, bringing more optimism.
A contract for 30,000 mt of ex-Vietnam 3SP billet has been done at $592/mt FOB this week, which translates to about $620-622/mt CFR China, with transportation to the Yangtze River area, according to sources. Late last week, a deal for ex-Malaysia billet was done at $610-615/mt CFR, as SteelOrbis reported earlier. Offers from Vietnam were withdrawn after this deal.
Also, there have been reports of negotiations with the main Indonesian supplier in China at $620/mt CFR, though no deal has been confirmed. Some sources said that it may have been done and that they have heard new offers at $625/mt CFR to China.
Following the deals for ex-ASEAN billet at a higher price level, the tradable value for ex-CIS billet has increased to $607-609/mt CFR. One of Chinese trading firms has claimed that a deal for Russian billet has already been done to China at $605/mt CFR this week, but other sources have said that the sale was not to mainland China, but to Taiwan.
An offer from India has been at $610/mt CFR, with negotiations said to be ongoing.
The workable price level for ex-Iran billet to China is at $600-605/mt CFR, sources have said, while the previous deal was done at $592/mt CFR earlier this month. All non-ASEAN billet import shipments are subject to two percent import duty.
The main boost for the import billet prices in China has been from the rising local market amid the production cuts announced in Tangshan for the period up to the end of 2021. Steel mills in Tangshan have increased their prices for billet by RMB 50/mt ($7.7/mt) today to RMB 4,650/mt ($712/mt) ex-works. This also indicates a RMB 30/mt ($4.6/mt) increase from Monday, March 22. With current higher billet prices, exporters may eye $630/mt CFR for ex-ASEAN billet, according to sources.
$1 = RMB 6.5282