Weekly: Global billet market overview

This week, global billet prices started getting softened on weakening scrap prices. SteelMint witnessed, in a recently concluded deal for Baltic origin-based bulk scrap cargo. Turkish buyers had remained quiet earlier in the week. It kept suppliers under pressure and held them back from going for a price hike.

Anticipating prices to fall, buyers were posing limited buying interest. The market has somewhat started functioning in line with the anticipation of the buyers.

On the other hand, the Chinese SHFE rebar futures contract witnessed a weekly drop of RMB 193 ($29) yesterday and reported having settled at RMB 4,294/t ($664/t). The fall is being attributed to the fresh outbreak of COVID in a few Chinese provinces like Hebei, aggravated further by harsh winters. It has resulted in sluggish finished steel demand.

CIS- The price indications have dropped sharply and are currently at $585-590/t, FoB Black Sea, down by $5-10/t, w-o-w. However, during the beginning of this week, offers had even crossed $600/t FoB levels. The slowdown in the global scrap market has brought down the offers from the region.

India- SteelMint's bi-weekly assessment for Indian billets (150*150mm, BF route, FoB east coast) is $575-580/t, up by $10-12 against last week.

• Export prices of Indian billet rose again, at the end of the last week, in a tender hosted by an Indian state-owned mill floated for 30,000 t billets (150*150mm, 3SP/4SP grade). According to SteelMint sources, the company managed to achieve a price level of $575-580/t, FoB India, up by $38-40 against a previous tender concluded in mid-Dec '20.
  
  
• With this, the Indian billet export prices are now at a seven-year high. Strong domestic demand and high raw material prices (export and domestic both) are strongly supporting this surge.
  
  
• Indian mills are enjoying healthy margins in the domestic market despite a rise in conversion cost.
  
  

Iran- SteelMint's bi-weekly assessment for Iranian billet is $565-570/t, FoB, unchanged against last week.

• On the contrary, Iran's leading steel exporter has concluded an export tender for 30,000 t billets (150*150mm) for early Mar '21 shipments. The company managed to achieve a price level of $570/t, FoB.
  
  
• Soon after the market went slow the Iranian mills were struggling to get the desired price levels, a reliable market participant told to SteelMint.
  
  
• Chadormalu floats 30,000 t billet export tender: Chadormalu Mining and Industrial Company, one of Iran's leading steel exporter, floated an export tender for 30,000 t billets for Feb '21 shipments. The company is targeting the price levels of $570-575/t, FoB Iran.
  
  
• On the other hand, domestic billet demand saw a sharp drop in a recent trade event hosted at the Iranian Mercantile Exchange (IME) amid sufficient billet stocks with the re-rollers, sources reported to SteelMint. According to our sources, approximately 18,000 t of billets were traded at IRR 123,213/kg ($490/t), up by IRR 6,045/kg ($26/t). The offered quantity was around 180,000 t.
  
  

• We further tried understanding from the mills about their approach for the high supply-demand spread created after the IME event. Mixed responses were as follows-
  • Billet export allocations may increase.
    
    
  • Likely to focus on the finished products in anticipation of better realizations.
    
    
  
  
  

SE Asia- This week, SteelMint's assessment for billet import in SE Asia is $600-605/t CFR, up by $10-15 against last week.

• SE Asian billet market continues remaining dull on wide bid-offer spread. The offers have crossed $610/t, FoB levels, while bids were reported at $590/t, CFR. Anticipating prices to fall, buyers are posing limited buying interest.
  
  
• Vietnam billet export offers drop by $10- The BF billet export offers from the country dropped by $10 this week, and the offerings are currently standing at $590/t, FoB Vietnam (BF route). While IF route billets are offered at $585/t, FoB Vietnam.
  
  
• Thailand billet import price indications range-bound- Billet import offers in the country continue hovering at $600-605/t CFR, unchanged against last week.
  
  

Chinese domestic billet prices up by RMB 10 ($1.5) w-o-w- This week, the billet prices in the Tangshan market (northeast China) settled with a rise of RMB 10 ($1.5), against last week. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,810/t ($590/t) in Tangshan, including 13 % VAT.

Global billet market snapshot-