Billet prices in the Black Sea region rose this week on the back of broad production cutbacks and stabilising scrap prices, with good demand coming from the Middle East, traders said.Traders quoted Black Sea free-on-board (fob) billet at around $530-535 a tonne, from $510-525 a tonne last week.
"Production has been cut worldwide," a trader in Europe said. "That probably has helped to keep prices at the levels they are at."
She said there was demand strength in the Middle East and North Africa.
But traders underlined it was suppliers pushing prices higher, as well as the pull of demand, supporting prices.
"Any mill that produces billet and rebar needs the price to increase," she said. "I''m not sure anyone has confidence anything will hold at the moment and everyone is watching the scrap price like a hawk."
China''s crude steel output dropped 7.1 percent in September from August, government data showed on Thursday, and an industry official said the decline may extend into the fourth quarter as the world''s largest producer makes a last-ditch effort to meet year-end power saving and emission reduction targets. Limiting the support capacity closures offer prices, though, the construction sector was set to quieten during winter.
Some production was starting to come back online, however. China''s daily crude steel output rose by 0.6 percent in early October from the previous month, industry data showed on Friday, as mills resumed production after state-enforced power curbs.
Steel prices on the Chinese market remained unchanged this week. Iron ore prices rose slightly on Friday.