With China accelerating its billet imports, backed by high local prices and a lack of supply, Turkey has taken advantage of the opportunity to conclude deals to this destination even despite the high freight rates. More negotiations are said to be continuing.
According to sources, a steel producer in northern Turkey has traded 45,000-50,000 mt of billet to China. The price is generally reported at $582-583/mt FOB but some market players stated that the deal was done at $586/mt FOB. Freight from Turkey to China has been estimated at $65/mt. As a result, the CFR price level in the deal translates to about $647-648/mt CFR or above. Higher bids from China have enabled Russian billet exporters to sell to China as well, but mainly from Russia’s Far East region The latest sales for billet from this region have been done at $650-655/mt CFR China, for a total of 40,000 mt this week.
Negotiations for billet sales to China are still continuing. But the price rise has temporarily stopped due to declines in rebar futures prices in China over the past two days. Domestic billet prices of steel mills in Tangshan are at RMB 5,060/mt ($772/mt) ex-works on April 8, including 13 percent VAT, which is RMB 240/mt ($37/mt) higher compared to April 1, but is stable compared to the previous day.
Along with the billet transaction to China, one mill has reportedly sold 10,000 mt to Morocco at $580/mt FOB. Local billet prices in Turkey have rebounded since earlier this week in fresh sales closed in the Iskenderun region. One steel producer there has traded 10,000 mt of billet at $585/mt ex-works, after having sold a total of 12,000-17,000 mt early this week at $577/mt ex-works.
Import billet business remains occasional in Turkey, mainly since buyers’ and sellers’ price ideas do not match. Low rebar prices and subdued demand prevent import prices for billet from increasing in line with scrap prices. As a result, only a few import deals have been reported. A seller from Russia has traded a total of 12,000 mt of billet for shipment with a short delivery period at $577-578/mt CFR Bartin and $588-590/mt CFR to the Izmir region. Overall, this week most suppliers, especially large mills, have been aiming to sell at $595/mt CFR and above, while bids were generally at $580/mt CFR and below.