As Chinese export prices on finished steel products have encountered a downtrend amid a domestic slow down, billet prices have also decreased, dropping down to $380-390/mt FOB China.
According to a source, prices for Chinese billet are expected to be below $400/mt CFR Taiwan soon as Chinese traders seek to place export cargoes. Given the bearish sentiment on billet, a scrap alternative, as well as slow finished steel sales, Taiwanese mills have decreased domestic scrap prices for the third week in a row and are unwilling to proceed with deals from the US at present prices.
Ex-US scrap offers for HMS I/II 80:20 are remaining at $250-255/mt CFR Taiwan, stable week-on-week. Only a few suppliers were heard offering HMS I/II 80:20 on the low end at $250/mt CFR late into the week ended April 14 and into the current week. According to sources, most suppliers will remain on the sidelines and forego making offers to the Asian market as April is a traditionally sluggish month for scrap exports, and price expectations from Taiwanese mills are quite low at $240/mt CFR Taiwan for HMS I/II 80:20.
Given the market conditions, one source noted that despite strong US domestic demand for scrap, the export conditions to Asia may bring ex-US deal prices for HMS I/II 80:20 on the West coast down to $240/mt CFR Taiwan in limited quiet deals.
According to a separate source, ex-US scrap deals are expected with Vietnamese mills for summer deliveries but only once the market bottom becomes evident; since duties were implemented on import Chinese billet to Vietnam, scrap trade with the US has increased.