Growth in procurement of billets in China leads to higher prices

Prices for imported billets in East Asia are rising again amid China's return to the market. The growth was driven by an expected reduction in steel production in China and an increase in coking coal prices.

Several deals for 150mm 3-sheet piles from ASEAN, including a deal from a blast furnace in Indonesia, recently closed at $ 685-688 per tonne in China, according to a Hong Kong-based trader. Another heard that 20,000 tons of Russian billets were ordered at about $ 675 per tonne, and Vietnamese billets were ordered even at $ 690 per tonne in China. “China started buying again,” says a second trader.

Billet from ASEAN countries and the Middle East is currently offered at $ 690 per ton in China. A Chinese trader says he has offers for Indian and Iranian billets at $ 680 per tonne francs. Offers are valid for October and November shipments. ASEAN billet was offered at a price of 680-685 dollars per tonne at the beginning of last week. Traders heard that 40,000 tonnes of 130mm billets and 10,000 tonnes of 160mm billets from Brazil were ordered at the start of the week at $ 668 per tonne from China.

In Tangshan, spot billet rose by 70 RMB /t (US $ 11 /t) to 5,060 RMB /t (US $ 777 /t) on September 3. China's domestic spot prices have risen to 5,000 yuan /ton since August 31, after nearly two weeks of fluctuations at 4,910-4,990 yuan /ton. According to a regional trader, the rise in steel prices in China is associated with a sharp rise in the coking coal market. “Coking coal is expensive; I think China is considering importing pig iron again, ”he adds.

Meanwhile, in Manila, a leading Vietnamese mill is offering blast furnaces for $ 700 a tonne, a trader said Friday. According to the importer, the Vietnamese billet of 5 sheet piles is estimated at $ 680-690 per ton, and the Russian 125 mm billet of five sheet piles is $ 685-690 per ton. Some report that Vietnamese EAF and 5sp blast furnace billets are still offered at $ 675-680 per tonne in Manila. However, Callanish learned from Vietnamese trade sources that most of the factories had stopped selling due to the national holidays of September 2-3.

Apart from a deal to buy Russian 100 mm square billets at a price of $ 675-680 per tonne in Manila on August 30, no other deals have been heard in Manila as there is little buying interest. “Local demand and prices were just low,” notes a local merchant. On Friday, Kallanish estimated the cost of a square billet Q275 120/125/130 mm 5sp /ps or $ 675- $ 685 per tonne in Manila, up $ 10 over the previous period.