Posted on 14 Oct 2020
Billet import prices are rising in China, Kallanish notes. Certain bullish traders are seen to be recently taking long positions in the market.
A 20,000-tonne cargo of 3sp blast furnace billet from Vietnam was booked last Friday at $445/tonne cfr China ($435/t fob). Early last week, another trader booked a similar tonnage from the same Vietnamese mill at $427/t fob. Both are December-shipment cargoes.
The Chinese billet market has been performing strongly. Domestic billet prices rose by CNY 50/t ($7/t) in the past five days to CNY 3,420/t ($508/t) in Tangshan on Tuesday. Compared to before the holiday, prices have risen by CNY 120/t.
Offers are prevailing at $445/t cfr China, a trader says. He hears this is the offer price from a Korean steel company and guesses it is for December shipment.
But the market has not heated up so much, some Chinese traders say. Only a limited number of importers are in the market now, a Chinese trader said on Tuesday. At current spot prices, he thinks that Chinese importers will bid at up to $440/t cfr China.
Meanwhile, in Southeast Asia, traders are pondering over an Iranian billet booking because of its unusual destination. The 50,000t cargo comprising 130mm/150mm billet was heard booked by a few buyers at $440/t cfr Philippines. The cargo is for end-November/first-half December shipment and was heard booked in the second half of September.
An Iranian cargo going to the Philippines is unusual because of mandatory inspections by a Philippine government-approved inspection agency for all imports, a regional trader says. A Manila trader says that "…customers can gamble" if the discount for Iranian billet is more than $5-10/t from prevailing market levels. Documents should be properly "…doctored" or they will not pass the scrutiny of Customs, he adds.
Others say the cargo could be re-exported from China. “It makes sense if it’s via China, because they have done it before,” a Manila trader says. It is possible that the cargo is resold from China – “…they did this for many years already," a Thai trader says.
Source:Kallanish
