The positive signs of the market in China have resulted in more optimistic sentiment in the billet market, not only in Asia, but also in the Black Sea region and Turkey. Some Asian suppliers have already increased their prices for Turkey, also after quite sizeable sales. If it continues, the positive trend may help billet suppliers to Turkey, mainly the Russians, to avoid further discounts, which buyers have been insisting on throughout the current week.
Turkey has revealed decent interest in ex-Malaysia billet since it is a duty-free origin and due to the fact that the suppliers have provided good discounts. As a result, according to sources, at least around 30,000-40,000 mt of billet have been purchased in two or three deals within the range of $540-545/mt CFR, versus initial offers of $550-555/mt CFR last week. Currently, there is no June shipment allocation from Malaysia, while Turkey finds it a bit early to purchase for July. Given the positive sentiment in China, the most recent prices from Malaysia and Indonesia are evaluated at $550-555/mt CFR Turkey and may increase further next week.
Such a development may help alternative sellers of billets, particularly from Russia, to avoid price decreases. The SteelOrbis reference price for ex-Russia billet has been settled at $515-520/mt FOB Black Sea, rebounding by $5/mt since the level in the middle of this week and stable week on week. Even though most ex-Russia and ex-Donbass billet suppliers have been not increasing offers so far, due to better sentiments most of them have decided not to go below $545/mt CFR Turkey or $515-520/mt FOB.