China, the world’s largest steel producer, witnessed a significant decline in imports of steel billet in May 2022. Import volumes stood at 0.22 million tonnes (mnt) last month, a 28% m-o-m fall compared to 0.31 mnt in April, customs data maintained with SteelMint shows.
UAE leading exporter
The United Arab Emirates (UAE) emerged as the largest exporter of steel billet to China at 0.11 mnt in May. Import volumes from the UAE witnessed a sharp rise of 450% m-o-m as against 0.02 mnt in April.
Russia occupied the second position among the top importers in May 2022 with 0.07 mnt followed by Japan with 0.02 mnt. However, imports of steel billet from Russia and Japan fell by 12% and 33%, respectively.
Why have imports fallen?
Steel production curbs, limited demand for semi-finished steel, preference for domestic billet amidst cost competitiveness, and the Covid upsurge, followed by lockdown restrictions, decreased the country’s import bookings, SteelMint understands.
Billet imports down in Jan-May, 2022
Imports of the material into China stood at 2.50 mnt in January-May, 2022, a decline of 33% y-o-y as against 3.76 mnt in the same period last year.
On a y-o-y basis, Russia and Oman were the largest exporters of steel billet at 0.6 mnt each, followed by Iran and the UAE with 0.32 mnt and 0.20 mnt, respectively.
Price trends
SteelMint’s assessment of China’s imported billet (150x150mm, 3SP) prices fell to $643/t CFR in end-April, 2022 from $690/t CFR levels at the end-March. Prices further fell sharply to $610/t CFR by end-May.
Chinese billet import outlook bearish
China’s imports of semi-finished steel are expected to be on the lower side owing to weak demand and preference for domestic billets.
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