Global billet offers have surged by USD 40-50/MT in March after sharp rise in Chinese domestic prices that forced Chinese exporters to withdraw offers. Prices seem to have firm up as buyers resist. Traders anticipate that market is fundamentally not strong and prices had gone up only on sentiments that Chinese mills will cut down production.
China
Billet export offers from China have retreated from USD 320/MT FoB to USD 300/MT FoB in the month of March. Quite a few small and mid sized mills have defaulted on deliveries, which has supported price hike. But looking at demand, prices may not stand firm in medium to long term.
CIS
CIS market is largely included by Turkey. Billet offers from Russian and Ukrainian suppliers went up after Turkish re-rollers faced supply crunch. Current offers are assessed in the range of USD 320-330/MT, FoB Black Sea and around USD 340/MT, CFR Turkey.
India
There is an active tender of 50,000 MT billet/bloom by Vizag Steel, expiring on 11 Apr’16. Market is anticipating bid levels of USD 320-330/MT, FoB India East Coast. Cargo is most likely to be bid by Bangladesh re-rollers, who enjoy differential duty for Indian billet under SAFTA agreement.
Bangladesh
Trade sources report that buying interest remains quite weak on strong rumors that government may increase import duty on billet by around USD 25/MT (current duty is USD 90/MT).
Vietnam
Government has recently increased import duty on billet by 10% to 23.3% in order to control rising imports. Domestic demand has improved post government’s decision, leading to hike in domestic prices. The amount of imported steel billet rose from more that 466,000 MT in 2012 to 1.5 MnT in 2015.
Global MS billet prices as on 30 Mar’16
| Particular | Delivery | Grade (mm) | Currency | Price | W-o-W | M-o-M | Remarks |
| China Export | FOB China | 150*150 | USD | 300-305 | -5 | +25 | Prices stabilize after a sudden rise. |
| India Export | FOB Vizag | 150*150 | USD | 320-325 | 0 | +40 | 50,000 MT tender by Vizag Steel is due on 11 Apr’16. People expecting price bids at USD 320-325/MT, FoB Vizag. |
| CIS Export | FOB Black Sea | 125*125 | USD | 320-325 | -5 | +60 | Offers move up on rising scrap prices in Turkey. |
| South East Asia Import | CFR SE Asia | 150*150 | USD | 315-320 | 0 | +50 | – |
| Bangladesh Import | CFR Chittagong | 150*150 | USD | 320-330 | -5 | +40 | Buyers reluctant on rumors that government may increase duty on billet. |
| Middle East Import | CFR Dubai | 150*150 | USD | 325-330 | 0 | +60 | Buyers prefer to wait and watch over sudden rise in prices. |
| Turkey Import | CFR Turkey | 125*125 | USD | 330-340 | 0 | +60 | Buyers Hesitant |
| India Domestic | Ex-Mumbai (ex-works) | 125*125 | INR | 24,300 | +300 | +200 | Prices rise on higher scrap prices in global market. |
| China Domestic | Ex-Tanshang (17% VAT included) | 150*150 | RMB | 2,020 | -20 | +310 | Prices stabilize |
Offers are in Currency per MT
Source: SteelMint Research
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