According to the SteelMint data, the total billet (under HS code 7207) exports in 2017 from major countries like Russia, India, Brazil, Ukraine, Japan, and Iran have registered an increase of 2.27% at 39.63 MnT against 38.75 MnT in 2016.
The key reason for the same can be attributed to absence of Chinese billet from the overseas market due to its improved domestic demand and government enforced production capacity cuts as a measure to control overcapacity and rising pollution levels.
Although China is the biggest billet exporter of the world, we have not included its exports in our analysis as it exports billet under the broad category of ‘bars and rods’.
Fall in Russia’s billet exports in 2017
1.Russia exports highest quantity of billet after China. The country’s billet export in 2017 stood at 14.38 MnT against 15.16 MnT in 2016, a decline of 5.14% y-o-y basis. The increased billet export prices from Russia over rising raw material, coal prices has resulted in decline in Russia’s billet exports in 2017.
2.During the year, Taiwan remained prime spot for Russian billet exports. Out of the total billet exported in 2017, percentage share of billet exports to Taiwan was highest at 23%, 3.23 MnT followed by Turkey at 16%, 2.30 MnT and then Mexico at 14%, 2.08 MnT.
Brazil’s slab export under HS code 7207 surges by 23% Y-o-Y in 2017
1. Brazil’s exports under HS code 7207 majorly includes slabs. As per the country’s customs data Brazil exports under HS code 7207 stood at 7.66 MnT in CY17 (Jan-Dec), up by 22.56% against 6.25 MnT in 2016.
2. The increase in country’s exports can be attributed to anti-dumping duty imposed by EU (European Union) on plate imports from China.
3. With the imposition of anti-dumping duty on plates, the countries started importing slabs from Brazil in order to roll the same into plates.
4. According the reports, Brazil’s steel major, Companhia Siderúrgica do Pecém (CSP) planned to increase its slab exports to 2.90 MnT in 2017 against 1 MnT in 2016 which it was able to achieve during the year.
5. While the company had offtake agreements with its three shareholders – Brazilian miner Vale (50%) and South Korean steelmakers Dongkuk (30%) and Posco (20%), which were then responsible for re-selling slab to final customers, in 2017 the company sold slabs directly to the customers in the spot market.
6. In CY17, U.S. (2.51 MnT) remained the most favourable export destination for Brazilian billet followed by Mexico (0.65 MnT) and Turkey (0.65 MnT).
Ukraine’s billet export registers fall of 21% in 2107 Y-o-Y
1. Ukraine’s billet export under HS code 7207 in 2017 stood at 6.15 MnT against 7.75 MnT in 2016, a decline of 20.6%% y-o-y basis. This fall in country’s billet exports can be attributed to conflict in eastern Ukraine where majority of steel mills are located.
2. During the year, Italy remained prime spot for Ukranian billet exports. Out of the total billet exported in 2017, exports to Italy stood at 1.86 MnT followed by Turkey at 1.12 MnT and then Egypt at 0.98 MnT.
Japan’s billet exports also falls in 2017 against previous year
1. Japan’s billet export under HS code 7207 in 2017 stood at 4.00 MnT against 4.26 MnT in 2016, a This fall in country’s billet exports can be attributed to improved domestic demand from infrastructure sector during 2017.
2. During the year, Taiwan remained prime spot for Japanese billet exports. Out of the total billet exported in 2017, exports to Taiwan stood at 1.67 MnT followed by South Korea at 1.16 MnT and then Thailand at 0.38 MnT.
India’s billet exports increases significantly in 2017
India’s billet exports under HS code 7207 have registered a drastic increase of 59% from 1.75 MnT in 2016 to 2.78 MnT in 2017. The reason for the same can be attributed to absence of Chinese billets from the export market. Indian exporters took advantage of the situation and increased their billet exports in overseas market, targeting majorly Southeast Asian countries.
Nepal is the highest importer of Indian billet as its import from India stood at 1.09 MnT in 2017, followed by Indonesia at 0.41 MnT and then Philippines at 0.23 MnT.
Iran’s billet/slab export surges dramatically in first nine months of Persian calendar year in 2017
Iran billet/slab exports under HS code 7207 were recorded at 3.58 MnT in Persian calendar year starting from Mar’16 to 20′ Mar’17. Whereas the same stood at 4.66 MnT in just nine months of Persian calendar year starting from Mar’17 to 20 Dec’17.
The key reason for the same can be attributed to depreciation of Iran’s currency Rial against US dollars that has depreciated by almost 11% over the past one year. The depreciation of currency has made exports attractive for Iran’s billet manufacturers leading to increase in its exports.
Iran is majorly exporting billets to Thailand followed by UAE, Indonesia and Oman. The reason for the same being low freight charges against Russia which also targeted its exports to these countries.
Leave a Reply