Chinese imported billet prices rose Sept. 16 amid stronger physical market and bullish sentiment on stricter production cuts in Jiangsu, Shandong and Tangshan provinces.
However, buying interest was thin amid volatile prices.
Billet physical prices were higher in the morning session when rebar futures almost reached its high of the day, but ended with small gains.
The most actively traded rebar contract on the Shanghai Futures Exchange -- January -- closed at Yuan 5,541/mt ($861/mt), up Yuan 23/mt.
Tangshan Q235 billet was assessed at Yuan 5,285/mt, up Yuan 45/mt from Sept. 15. The interest for physical deals was lackluster in both northern and eastern China, said market sources.
More market talk of production cuts in Jiangsu province was heard, with several mills requested to shut down one blast furnace each. Stricter production cuts in Shandong and Tangshan were also heard.
“The weaker demand due to poor property market data drove the price volatility, but the bearish sentiment had been offset by tighter supply,” said an eastern Chinese mill source.
“The price will continue to rise as long as there is a supply-demand gap, indicated by continuously falling inventory in past weeks," he added.
This was echoed by a northern Chinese trader. “The price will easily rise but hardly drop,” he said.
However, Chinese buyers’ buying interest for imported billet deals was thin as the production cuts in Jiangsu likely dampened the billet demand as rerollers were likely to shut down.
The most competitive offer was for Vietnamese cargo of November shipment at $715/mt CFR China, while Indian and Indonesian material were higher at $720/mt CFR and $725/mt CFR separately.
In the Philippines, Vietnamese offers were at $705/mt CFR Manila and $710/mt CFR Manila for induction furnace and blast furnace material, said a Vietnamese mill.
S&P Global Platts assessed China-imported 3SP 150 mm spot billet at a midpoint of $701/mt CFR China, up $5/mt on the day. Platts assessed Southeast Asia 5SP 130 mm spot billet at $690/mt CFR Manila, up $2/mt on the day.
-- Steel Business Briefing