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Weekly: Global billet market overview

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BigMint Bureau

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5 Sep 2020, 16:12 IST

The global billet prices increased marginally, supported by a hike in global scrap offers. Sizeable volumes booked in China, Thailand, and the Philippines from Russia and Iran. India continued to stay out of the global billet market amid better realizations in the domestic and the Nepal market. The bid-offer spread also saw a contraction.

CIS-The offers from the region a marginal rise this week and are at $400/t, FoB, up by $2 against last week. This week, sizeable billet volumes are booked for China, Philippines, and Thailand from Russia.

India- SteelMint assessment for Indian billet export offers (150*150mm) remained unchanged and is at $420/t, FoB India.

The majority of Indian primary mills continued staying away from the global billet market for this week as well on falling USD against INR supported by improving realizations in the domestic market. This week, INR appreciated to 72.7 against $, versus over 75 in mid-Aug'20. Owing to this, Indian mills have raised finished steel prices sharply for Sept'20. The price hike in longs is reported roughly around INR 1,000/t ($14). The raw material price hike has also contributed to pulling steel prices.
A state-owned primary mill has booked a billet rake for export to Nepal at $425/t, ex-plant, SteelMint learned from an official.
The secondary mills of the country have booked decent volumes for the SE Asian destinations. For instance, a western India based mill booked 10,000 t billets at a price level of $440-445/t, CFR, sources reported to SteelMint.
RINL has floated an export tender for 30,000 t (150*150m, 3SP/4SP) blooms against 100% advance payment terms. The tender due date was 02 Sep'20. As per sources, the tender was canceled, following which the company floated a fresh tender for a similar quantity. However, the result of the tender could not be confirmed, until the time of publishing this report.
Chinese bids for Indian billets saw an increase-On rising domestic billet prices and rebounding rebar futures, the Chinese buyers have increased their buying offers for the Indian billets. This week, the bids have seen in the range of $432-437/t, CFR China, up by $5-7/t, against last week.

Iran- This week SteelMint assessed billet export offers from Iran to be at $400-405/t, FoB Iran, unchanged against last week.

Iranian billet export offers continued to remain unchanged for this week as well. However, the country has booked decent volumes for China and Thailand.
From the past three weeks, the current export offers from the country are at $400-405/t, FoB levels. Most of the mills are now targeting above $405/t, FoB levels, which is like an ambitious target considering the current market situation, said Planner official. Although the mills are likely to increase the offers by next Iranian week (Post Friday), not before CIS offers goes higher than $400/t, FoB, he added. Also, a recent hike in Turkey imported scrap prices are likely to pull the country's billet export offers in the near short term.
Chadormalu books 60,000 t billets for Thailand and China- Since last week, the company has booked 60,000 t billets for Thailand and China; 30,000 t each. The company managed to achieve the price levels of $398/t, FoB Iran for Thailand Shipment, and $404/t, FoB Iran for China Shipment. Both the shipments are likely to be scheduled by end-Sep'20.
IME saw no billet trades this week- This week, all billet deals have canceled at the Iranian Mercantile Exchange (IME). The quantity offered for the week was around 106,000 t. According to SteelMint sources, the deal values have reached the levels of IRR 93,000/kg (~$439/t). Hence, the government aborted all the deals. The Iranian government keeps a check that domestic steel prices should not gain extreme volatilities. The IME is likely to host the next billet trade event on the coming Saturday (05 Sep'20), a market source said to SteelMint.

SE Asia- This week, SteelMint assessment for billet import offers in SE Asia have moved up marginally and is currently at $435-444/t, CFR, up by $5 against last week.

This week, the SE Asian billet import market saw sizeable billet volumes booked, after three long weeks. The deals have primarily concluded for Thailand, Indonesia, and the Philippines between the price levels of $435-445/t, CFR. Russia and Iran stood the prominent exporters for the week. The bid-offer spread also saw a contraction this week. The offers in the region have touched $447/t, CFR levels, and bids have seen at $438-440/CFR levels.
The Philippines reported having booked billets from Russia at $445/t, CFR levels. On the other hand, Thailand booked the Russian billets at $435/t, CFR level. However, the SteelMint could not confirm the volumes until the publishing time of this report.
Esfahan Steel Company (ESCO), one of the leading steel exporters of Iran, has booked 10,000t (200*200mm, commercial-grade) billets for a SE Asian destination. The company managed to achieve a price level of $415/t, FoB Iran. The shipment is likely to be scheduled by end-Sep'20 for Indonesia.
CIS- The offers from the region for a SE Asian destination heard at $446-447/t, CFR.
India- The majority of the Indian primary mills have not been offering in the global market amid better realizations in the domestic and the Nepal market. However, a state-owned mill has floated a spot sale tender for the exports of 30,000 t (150x150mm, 3SP/4SP) blooms against 100% advance payment terms. The shipment is likely to be scheduled for mid-Oct'20. The tender due date is 04 Sep'20.
Vietnam- This week, the billet offerings from the country have increased by $10 and is currently at $445/t, FoB.

China- This week, Chinese domestic billet prices settled with an increase of RMB 90, against last week's closing. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,490/t ($510/t) in Tangshan, inclusive of 13 % VAT. The bids for imported billet in China also saw a rise and were ranging from $435-440/t, CFR, for non-ASEAN billets.

Global billet market snapshot-