Weekly: Global billet market overview

This week, global billet prices were reported to witness a hike of $5-12/t on increased steel futures in China resulting in enormous billet imports in the country. During 07-15 Jul’20, Chinese steel futures have noted a rise of ~RMB 103.

The price hike was also supported by increased Turkey’s imported scrap prices. SteelMint’s assessment for USA origin HMS 1&2 (80:20) is at $263/t CFR Turkey, up by $5/t against the closing of last week

CIS- Amid increased global scrap prices, the billet export offers from the region were reported to have an increase of $7-8/t this week, and are standing at $370/t, FoB Black Sea.

India- SteelMint assessment for billet (150*150mm) export assessment from India now stands at $395/t, FoB India, up by around $10-12, against last week.

• This week, India was reported to have booked over 180,000 t billets with a sharp increase in prices. The bookings were largely made for China. The rising Chinese steel futures have resulted in high price deals and volumes. The rebar futures were reported to have witnessed a rise by around RMB 103 since last week.

Iran- SteeMint assessment for billet export offers from Iran has risen and is at $375-385/t FoB Iran, up by $5 against last week.

• Iranian billet export market was reported silent this week. However, export offers from the country witnessed a decent rise against last week. According to sources reported to SteelMint, most of the Iranian mills are either booked or are having limited export allocation till Sep’20. The mills have liability to supply in the domestic market, over and above, they are getting better realizations in the domestic market than exports. And is one of the reasons for the rise in domestic billet offers from the country. Moreover, the rise in Chinese steel futures has supported the event. In the last one week, the futures were noted to have registered a hike of ~RMB 100.
• Domestic billet price witnesses a sharp hike- This week around 109,500 t billets were traded at Iranian Mercantile Exchange (IME) at an average price of IRR 80,900/kg ($365/t). The base price reported was IRR 599,23/kg ($270/t). Since, last week, no billets were traded, the domestic demand-supply gap got widened resulting in the sharp price hike.

Note: Iranian mills exchange 80% of their foreign currency at Nima exchange and 20% Sana exchange

SE Asia- This week’s SteelMint assessment for billet import offers in the SE Asia region is at $410-415/t, CFR, up $5-10 against last week.

SE Asia Billet Imports

• SE Asian billet import market was reported silent this week amid soft demand due to the rise in the billet export offer from India, Iran, and CIS Nations. Amid slow demand in finished steel, the buyers are bidding low i.e. in the range of $390-400/t, CFR. While the offers in the region are between $405-420/t, CFR.
  • Indian BF grade billet export offers for SE Asia are assessed around $410-415/t CFR SE Asia for Sep’20 shipment
  • Iranian billet export offers stand at around $410/t CFR SE Asia
  • CIS origin billet export offers have moved up this week and are assessed at $375/t FoB Black Sea
• However, countries like Indonesia are likely to increase their finished steel prices by IDR 200/kg (~$13/t) so that they can enjoy some margins and resume billet bookings, SteelMint learned from the market participant. Currently, there is a huge disparity between bids and offers in SE Asia.

 SE Asia Billet Exports

• Indonesian mill concluded billet export deal to China- The country was reported to have booked around 10,000-20,000 t billets for China at $420-425/t CFR this week, sources reported to SteelMint. The country was noted active in the billet export market from the past couple of weeks.
• Vietnam’s Formosa raised billet offers- Formosa Ha Tinh Steel, one of the leading steel manufacturers of Vietnam has released its offers for Sep’20 shipment. According to sources, the company is offering billets at $400-410/t, CIF (subjected to grade and size), up $4-5/t, against last month. The country was also reported to have booked ~60,000 t billets for China at $420-425/t, CFR. However, SteelMint could not confirm this deal until the publishing time of this report.

China- This week, Chinese domestic billet prices closed with a rise of RMB 20, against last week’s closing. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,410/t ($487/t) in Tangshan, inclusive of 13 % VAT.

Global billet market snapshot-