Weekly: Global billet market overview

Global billet prices surged by around $30-40/t in recent deals after the Labour Day holidays. The cargoes broadly were booked for Chinese destinations. While the SE Asian nations majorly remained silent on high bid-offer disparity.

Reasons for price surge- SteelMint’s view

• China’s slashing of import tariffs on semi-finished steel to 0% boosted imports
• China’s decision to adjust export tariffs on 146 steel commodities, including finished long.
• SHFE rebar futures surge
• Increasing global scrap prices

Russia: The Russian billet export offers witnessed a sharp rise after China revised its import tariffs. According to SteelMint’s credible sources, the spot offers from one of the leading Russian mills is heard at $680/t, FoB Vlad/Vanino for June ’21 shipments. While a few black Sea offers were heard at $650-655/t, FoB.

India: SteelMint’s bi-weekly assessment for Indian billets (150*150mm, BF route, FoB east coast) is $635-640/t, FoB, up by $25-50 against closing of last week.

• Indian billet export prices surged in recent deals to hit a record high since data maintained with SteelMint from Nov’12
• According to SteelMint sources, an Indian mill recently sold 30,000 t blooms (150*150mm, 3SP/4SP grade) and 20,000 t billets (90*90mm, C20MMn Gr. A) at around $630/t and $635-640/t, on FoB India basis.
• On the other hand, a private primary mill witnessed offering billets at $700/t, CFR for China and SE Asian destinations.

Iran: SteelMint’s bi-weekly assessment for Iranian billets is $620-625/t, FoB, up by $20-25 against closing of last week.

• Iranian billet prices jumped by around $30, in a deal concluded at the end of last week.
• A leading Iranian steel exporter, Khouzestan Steel Company (KSC), sold 30,000 t billets to China at $620/t, FoB through a tender for June ’21 shipments.
• After this deal, the mills are now eyeing to achieve $625/t FoB Iran levels in their upcoming tenders. However, we didn’t witness any deals at this price level.
• ESCO floats 20,000 t billet export tender: A leading Iranian steel exporter, Esfahan Steel Company (ESCO), has floated an export for 20,000 t billets for June ’21 shipments. The tender is likely to be concluded in the coming week- SteelMint learned during conversations with a company official. In the previously concluded tender (during last week), the mill achieved a price level of $590/t, FoB Iran.
• On the other hand, Chadormalu’s official mentioned that they are planning to float the export tender in the coming week for 30,000 t (likely) billets. The company’s previous tender sold was at $599/t, FoB Iran, last week.
• Limited trades reported at IME against offered quantity: This week, approximately 52,000 t billets reported having traded against the offered quantity of 98,000 t. However, the domestic prices witnessed a marginal rise of IRR 730/kg ($3/t) to reach IRR 119,562/kg ($540/t). The domestic prices remained supported by higher export prices.

SE Asia: SteelMint’s bi-weekly assessment for Indian billets is currently at $695-700/t, CFR Manila, up by $20-25 against last week.

• SE Asian imported billet market broadly remained silent on high bid-offer spread amid increased global billet prices. The imported billet offers in the region have touched $700/t, CFR. On the other hand, the bids were seen hovering between $680-690/t, CFR.
• During conversations with a Philippines trader, SteelMint learned that a few of the Philippines-based mills have stopped production owing to a price hike.
• Vietnam: The IF routebillet export offers from the country surged by around $70-80/t and heard being offering at $730-740/t, FoB. No BF route offers were heard for this week.
• Thailand: The imported billet offers in the country were witnessed at $670-675/t, CFR, up by $5 against last week.

Chinese domestic billet prices opened with a rise of RMB 140 ($22) after labour holidays: Chinese domestic billet prices hiked significantly after the labour holidays by RMB 140 ($22), and yesterday settled at RMB 5,220/t ($812/t), up by RMB 230/t ($36) w-o-w. The price rise was amid increased SHFE rebar futures, which reportedly witnessed a jump of RMB 274/t ($42/t) after holidays, and yesterday settled at RMB 5,678/t ($883/t), up by RMB 287 ($45)

Global billet market snapshot: