Posted on 12 Nov 2020
Prices of billet in the Black Sea export market have rallied this week amid new sales at higher levels, leading to yet higher offers.
This comes amid Turkish scrap breaking through the $300/tonne cfr psychological barrier this week. It follows China's weekend iron ore rally that pushed steel prices up. This is supporting December-casting billet sales, of which there are few left, market sources tell Kallanish.
After a Russian coastal producer sold a 20,000-tonne lot of billet to a trader at $425/t fob Black Sea this week, a Ukrainian supplier was heard selling a large tonnage to Peru at just over $430/t fob Black Sea. These followed a sale by a Russian producer to Turkey's southern re-roller late last week of a 10,000t lot at $440/t cfr Turkey. The material is of drawing quality and for December loading, with freight assessed at $15/t by a trader, netting back to $425/t fob.
Market sources are now placing CIS mills’ offers at $430-435/t fob for January casting and expect sales to China from January books. With Tangshan billet gaining CNY 70/t since last weekend to CNY 3,580/t ($540/t) after new production restrictions were announced, it is expected that import prices will also follow. China is bidding at $460-462/t cfr, unworkable for Black Sea suppliers at current levels, but traders expect sales to conclude at the end of this or next week, at higher levels.
Some sources are still urging caution, as the ongoing second wave of the Covid-19 pandemic and the possibility of subsequent restrictions may still hamper the ascending trend. However, most are optimistic about January-casting sales at close-to-offer levels.
Source:Kallanish
