As of today, July 13, lower local rebar prices in China have contained the uptrend in the billet market seen from last week. Sources believe that weak seasonal demand in China will prevent prices from recording very sharp rises in the near future: however, demand for import billet is likely to continue as fears of production cuts still exist, SteelOrbis has learned.
Local billet prices in Tangshan have gone down by RMB 30/mt ($5/mt) today to RMB 5,100/mt ($788/mt) ex-works, equivalent to $697/mt, excluding 13 percent VAT.
Most Chinese traders agree that sentiment is less robust at the moment and bids for import billet have been prevailing at not above $695/mt CFR, while offers have remained at $700-710/mt CFR. “The market is not bad, but due to the summer season demand is not so great,” a trader said. The tradable price level for import 5SP billet in China has reached $695-702/mt CFR on Monday, according to SteelOrbis.
The average rebar price in China has declined by RMB 26/mt ($4/mt) today to RMB 5,177/mt ($799/mt) ex-warehouse.
China is expected to remain an attractive sales destination for billet exporters in the near future as demand from Southeast Asia is still subdued and the trend in other markets has started to be bearish.
Most ex-ASEAN exporters are still asking for $675-680/mt FOB in China. Indian material could be offered at $695-705/mt CFR.
CIS-based billet suppliers have increased offers to $650-655/mt FOB early this week, up by $5/mt from last week, but prices may be under pressure in the near future because of the recent decline in import scrap prices in Turkey.
$1 = RMB 6.4757