Unshackling the recluse, CIS mills have been attempting hike in billet prices. The mills have been putting up a façade of full order books proclaiming sold out of November production. However December booking is likely to commence in the 2nd week of November after the National Holidays.
The built up for the X-mas and New Holidays is expected to be less lackluster given improvement in billet offers by USD 20 per tonne to USD 30 per tonne in the last fortnight. To some extent the revival in sentiments can be imputed to the renewed buying by Turkish mills and Iran.
The general offers prevailing is at USD 540 per tonne to USD 550 per tonne FOB, Black Sea. However bids are going at USD 535 to USD 537 per tonne. It is reported that one prominent producer is offering USD 540 per tonne to USD 545 per tonne FOB convincing buyers about limited availability of December production indicating offers at USD 560 per tonne to USD 565 per tonne for January.
Despite recent lull in Iranian demand which had been raging hitherto the going is still better by USD 35 per tonne to USD 40 per tonne compared to Black Sea sales. Current going rates are USD 575 per tonne to USD 590 per tonne a climb of USD 15 per tonne to USD 20 per tonne since October. Moreover the since the current contracts are paid in cash owing to UN financial sanctions the buyers prefer to deal with the mills directly paying a premium.
In the Far East, longs and billet prices started going up in some countries amid growing prices for raw materials, which pushed up CIS square billet prices as well, although Russian suppliers have to be in fierce competition with producers from SE Asia. Thus, semis prices to Asian buyers have grown by USD 10 per tonne over the week, to USD 535 per tonne to USD 540 per tonne FOB or USD 565 per tonne C&F Far Eastern ports.
The going is good for the billets for the time being expected to peak at USD 600 per tonne, FOB before the winter break as the mills are able to put up a pretence of full order books. However with the rebar and wire rod demand unsupportive the sustainability is a question mark.