Weekly: Global billet market overview

This week, the global billet market broadly remained silent due to the New-Year holidays. The buyers were in a holiday mood and have extended buying to post-holidays. Despite limited buying interest, offers across the globe witnessed a surge.

Meanwhile, the Russian government revealed its intent about imposing the export duty on billets and rebars. It is to protect the Russian domestic steel industry. According to a few reports, the Federal Antimonopoly Service of Russia (FAS) has proposed a 13% duty on billet exports and a 12% duty on rebar exports. Russia exported around 10.93 mn t billets during Jan -Oct ’20.

CIS- Despite holidays, offers broadly remained stable and were reported at $575-585/t, FoB Black Sea.

India- SteelMint’s bi-weekly assessment for Indian billet export offers (150*150mm, BF route, FoB East coast) is $560-570/t, up by $10-15/t, w-o-w.

• Export allocations from the primary mills continue to remain limited.
• Two western India based secondary mills booked 6,000 t and 5,000 t billets at $545/t and $550/t, respectively, on an FoB India basis, for Africa destination.
• Vizag Steel floats 70,000 t export tender for blooms & billets: Vizag Steel, an Indian state-owned steelmaker, has floated an export tender for 50,000 t blooms (150x150mm, 200x200mm, 3SP/4SP) and 20,000 t billets (90x90mm, 65x65mm, IS 2830) for mid of Feb ’20 shipments. The tender due date is 04 Jan ’21. In a previously concluded bloom export tender, floated during mid-Dec ’20, the company achieved a price level of $535/t, FoB India. SteelMint’s bi-weekly assessment for Indian billets (150*150mm, BF route, FoB east coast) was $560-570/t.

Iran- SteelMint’s bi-weekly assessment for Iranian billets is $550-560/t, up by $25-30 w-o-w.

• Iranian billet export prices surged again in a recent deal. According to SteelMint sources, Khouzestan Steel Company (KSC), Iran’s leading semi-finished steel exporter, concluded its 30,000 t billet export tender, floated last week. The company’s official reported that they achieved the price levels of $550-555/t, FoB Iran. The shipment is likely to be scheduled for early Feb ’21. Iranian billet export prices have risen by $25-30 against last week.
• For the last three weeks, we saw Iran’s domestic billet demand growing. The broad price difference between domestic and export prices is driving the local demand. During a conversation with Iranian mills, we learned that low domestic billet prices are encouraging the buying from re-rollers. The re-rollers are enjoying pleasing margins in finished products (rebars) by exporting them to neighboring countries like Iraq.
• Domestic billet prices at IME surge further by IRR 4,261/kg ($16/t): In a recent trade event hosted by the Iranian Mercantile Exchange (IME), the domestic billet prices have further surged by IRR 4,261/kg ($16/t). According to SteelMint sources, approximately 133,000 t billets reported having traded at an average price of IRR 111,775/kg ($439/t). The quantity offered for the trade event was 134,352 t, while the base price was IRR 96,707/kg ($380/t).

SE Asia- This week, SteelMint assessment for billet import in SE Asia is $580-590/t CFR, up by $10-15 against last week.

• Trade silence continues in the SE Asian imported billet market due to the New Year holidays. Despite limited buying and trade silence, the offers are rising every week and have reached $600/t CFR levels this week. The buyers are anticipating a fall in prices as Chinese rebar futures are trending downwards. On the other hand, the flying global scrap prices have kept holding the billet prices at high levels.
• The sluggish finished steel demand is discouraging buyers from booking. Also, in a few ASEAN nations, the rebar is reasonable than billets. For instance, the domestic rebar in Indonesia is offered at IDR 8000-8100/kg ($565-570/t) exw. On the other hand, the imported billet is at $580-585/t, CFR levels.
• Vietnam- The BF billet export offers from the country reported stable at $570/t, FoB Vietnam levels.

Chinese domestic billet price down by RMB 140 ($21.4) w-o-w- This week, the billet prices in the Tangshan market (northeast China) settled with a drop of RMB 140 ($21.4), against last week. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,740/t ($572/t) in Tangshan, inclusive of 13 % VAT.

Global billet market snapshot-