Asia steel billet prices rise again but China momentum slows in late week

The price of steel billet sold to China increased again over the seven days to Friday April 9, stalling by the end of the week due to higher domestic billet supply to Tangshan, sources said.

Steel billet, import, cfr China, $/tonne

Steel billet domestic, exw Tangshan, Northern China, yuan/tonne

Steel billet import, cfr Southeast Asia, $/tonne

More sales of steel billet imported to China booked at the end of last week from Asean-origin sellers came to light during the start of this week.
Cargoes from both Indonesia and Malaysia of 3sp blast furnace (BF) billet came were reported this week at $660 per tonne cfr China. Offers from Asean producers then rose to $670-675 per tonne cfr, but no new sales were heard at this level at the time of publication.
A tender for Indian BF billet was heard closed at $592.50 per tonne fob earlier this week, with a deal for 30,000 tonnes of Indian BF billet heard transacted at $645 per tonne cfr China to Jiangyin port.
Offers for Turkish billet were heard at $645 per tonne cfr China during the week, while bids for Malaysia-origin billet were heard at $655-660 per tonne cfr on Thursday.
As a result, Fastmarkets’ price assessment for steel billet, import, cfr China was $645-660 per tonne on April 9, up $25-30 from $620-630 per tonne on April 1.

Higher supply in China ***

Fastmarkets’ assessment for steel billet domestic, exw Tangshan, Northern China was at 5,060 yuan per tonne on Friday, up by 100 yuan per tonne from a week earlier.
The week-on-week increase was lower than the preceding week’s rise of 250 yuan per tonne because more billet was supplied to end users in Tangshan this week, sources said.
“Both import billet and those from other regions such as Jiangsu are being delivered to Tangshan due to the attractive prices,” a trader in the city said.
The sharp decline in spot billet inventories eased this week, which also prevented prices from soaring, sources said. The billet stock in the Tangshan spot market totaled 200,000 tonnes on April 9, down by 10,000 tonnes from a week earlier. This compared with a drop of 210,000 tonnes in the preceding week, according to a local industry information provider.
Additionally, rolling margins from billet to bar are as low as 100-200 yuan per tonne this week, so consumers are unwilling to accept a further sharp price rise for billet, a second trader in the city said.

Southeast Asia ***

With China again soaking up the vast majority of steel billet tonnages, Southeast Asian markets have been in the background this week.
Offers to Manila for Vietnamese 5sp billet were heard at $660 per tonne cfr throughout the week, but there continued to be a wide gap between bids and offers in the market.
Fastmarkets heard bids at $625-635 per tonne cfr Manila for Japan-origin 5sp billet this week- up from $610 per tonne cfr last week.
Sources said that the smaller vessel sizes offered by Japan represent a lower risk to consumers in the Philippines considering the high market prices currently.
“Manila shall have to pay higher prices to get material or they must wait before buying,” a South Asian trader said. “They may have to consider $650 per tonne cfr for 5sp billet soon.”
“Offers for 150mm sizes of billet are $660-670 per tonne cfr Manila because of China buying but they can’t pay $660 per tonne cfr, and even $640 per tonne cfr is a stretch for buyers now,” a second South Asian trader said.
“Philippine domestic rebar and angle bars are not following the increase in billets and we are under a lockdown now technically speaking,” a Philippine trader said.
Fastmarkets’ daily price assessment for steel billet, import, cfr Southeast Asia, which mainly looks at 120-150mm 5sp grade billet sold into the Philippines, was $635-640 per tonne cfr on Friday, narrowing up $10 per tonne day on day, and up by $20-25 per tonne from April 1.
Following extensive market engagement, Fastmarkets will change the specifications of its daily price assessment for steel billet, import, cfr Southeast Asia from Monday April 12, after which it will be renamed to steel billet import, cfr Manila, $/tonne to give greater focus to the Manila market.

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