Weekly: Global billet market overview

It was the second consecutive week when the global billet market saw a limited flow of trades. The volumes have prominently booked for SE Asian destinations and China from Russia and Vietnam. On the other hand, Indian mills have seen offering limited billets for the exports. And Iranian mills were accomplishing their domestic market commitments. Due to the continuous rising SHFE rebar futures, the buyers from a few regions have seen in a wait and watch mode, leading to a bid-offer disparity. According to the data maintained with SteelMint, the futures recorded an increase of RMB 80 ($12) w-o-w and yesterday settled at RMB 3,782/t ($572/t)

CIS– A Russian mill reported having booked around 30,000 t billets for the Philippines. The mill achieved the price level of $452-453/t, CFR. The shipment is likely to be scheduled for Jan’21. This week, the billet export offers from the region saw a sharp hike and are at $415/t, FoB Black Sea, up by $10 against last week.

Indian billet export prices remain stable- SteelMint assessed export prices for 150*150mm, BF route billets from India to be at $418-421/t, unchanged against last week.

• According to SteelMint Analysis, even though the Indian mills are getting better price values in the domestic market than export, but due to increasing raw material and scrap prices amid supply shortage, the mills are experiencing low-profit margins. This event is likely to pull up the Indian billet prices further in the domestic as well as the export market.
• On the other hand, due to the sluggish demand, the buyers are not bidding in the range of offers. The bids from China for Indian billets have seen at $435-440/t CFR, while the offerings were at $445-450/t CFR levels.
• Vizag Steel, an Indian state-owned company, has floated a spot sale tender for the exports of blooms (200*200/150*150mm, IS2830 grade), billets (125*125/90*90/65*65mm, IS2830 grade), and hot-rolled wire rods (5.5-8.0 mm, SAE 1008 grade). The delivery is likely to be scheduled by the mid of Dec’20 to Nepal through rake shipment. The tender due date is 07 Nov’20.
• Indian mills have further lowered allocations for exports considering the hike in domestic prices.

Iran- The price indications for Iranian billet export stand at $410-415/t FoB, mills highlighted.

• The Iranian billet export market remained silent for the second consecutive week. The offers have been seen stable for this week as well. Although, the mills have also not seen offering diligently in the export market.
• On the other hand, the Iranian government has extended the exercise of discovering the prices by asking the mills to increase the offerings in the domestic market for this week. However, this week’s event didn’t turn out to be successful, as marketers reported minuscule buying at the Iranian Mercantile Exchange (IME) amid sluggish demand.
• In a recent trade event hosted by IME, immensely low billet volumes reported having traded. According to Chilan, 119,387 t billets have been offered, against which only 7,850 t transacted at an average price of IRR 103,199/kg ($394/t).

• The marketers believe the production has exceeded domestic consumption, and the lack of demand for billets shows that export restrictions are not justified at all. And to meet the country’s foreign exchange needs, steel exports should be taken more seriously and must be facilitated.
• However, mills are likely to start offering for the export market any time soon, said SteelMint’s credible sources.

SE Asia- This week, SteelMint assessment for billet import offers in SE Asia is at $450-455/t, unchanged against last week.

• This week, sizeable billet volumes reported having traded in the SE Asian billet import market. The billets have prominently booked for the Philippines from Russia and Vietnam. On the other hand, Indonesia and Thailand remained silent for this week as well. However, the import offers in the region have seen to be stable for this week.
• The Indonesian and Thai buyers are in a wait and watch mode, possibly anticipating a drop in futures, which will likely pull down the prices.
• Vietnam-The country reported having booked, sizeable billet (BF grade) volumes for China and the Philippines, in the price range of $453-457/t, CFR. However, we could not confirm the volumes until the publishing time of this report.
• Thailand-Billet import offers in the country continue to remain stable at $455/t, CFR.

Chinese domestic billet price up by RMB 60 ($9) w-o-w-This week, the billet prices in the Tangshan market (northeast China) settled with a rise of RMB 60, against last week. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,500/t ($529/t) in Tangshan, inclusive of 13 % VAT.

Global billet market snapshot-