Prices for import billet have eased in the Chinese market this week, reaching their peak last week. The decline has come after the retreat in the local billet prices after the sharp fall in iron ore prices.
Today, March 10, mills in Tangshan have cut their local billet prices again - by RMB 50/mt ($7.7/mt), to RMB 4,300/mt ($660.5/mt) ex-works. The average spot price is at RMB 4420/mt ($679/mt) ex-warehouse, down by RMB 80/mt ($12.3/mt), according to SteelOrbis’ data. Prices include 13 percent VAT.
In such conditions, demand for import billet has slowed down visibly. The buyers’ price idea for ex-ASEAN billet is at $600/mt CFR at the highest now, while deal prices touched $620-622/mt CFR last week.
The price level for non-ASEAN billet, which is subject to two percent import duty, is $585-590/mt CFR at the moment.
Some market sources believe that the downward correction will be short-lived as the overall outlook for rebar demand and for billets, as a result, will be good in March. But most market participants are watching the futures market, which showed declines for the last two days. Today, rebar futures at Shanghai Futures Exchange have closed at RMB 4,589/mt ($705/mt), dropping by another RMB 123/mt ($19/mt) on the day.
$1 = RMB 6.5102