Posted on 17 Jun 2020
Another increase in offers by CIS billet mills is preventing sales, as buying appetite turned softer on the back of lower China prices and rising fears of a second Covid-19 wave.
Offers of Russian billet produced in July by coastal mills are now in the region of $380-390/tonne fob Black Sea, while the Ukrainian vertically-integrated supplier indicates $380/t fob for August-shipment material, Kallanish learns from participants. Not one large Russian producer has any July-casting billet volumes left, traders say.
There is demand in Saudi Arabia, but with quotes at over $400/t cfr, the buying mill has not committed to booking any CIS billet, although negotiations may still be ongoing. Traders cite $360/t fob as a workable price both to Saudi Arabia and Morocco, where buyers are willing to pay around €365/t cfr. This nets back to $360/t fob once payment terms, duty and traders' commission have been taken care of. Turkey is not actively sourcing material, having bought a sufficient amount of scrap and seen prices stop rising, traders note.
Physical demand remains a problem, as some countries' industries are not expected to recover fully this year, and the finished long products market is still weak. All eyes are on China now where a fresh outbreak of Covid-19 in Beijing has already affected both rebar and hot rolled coil futures prices (see Kallanish passim).
Source:Kallanish
