China was not heard to have imported any steel billet in January due to the holiday lull in the domestic markets.
Current billet import offers are around $450 per tonne cfr China - equivalent to around 3,550-3600 yuan ($461.06-467.55) per tonne fot major ports including 13% value-added tax.
The current ex-works price for billet in the key import market of Jiangsu province is at 3,410-3,470 yuan per tonne including VAT, meaning that the import arbitrage window has closed due to the higher import prices.
Market sources expect little chance of the import arbitrage window opening again before Chinese New Year because of the likelihood that domestic steel billet prices will drop further on weakening demand.
“Re-rolling mills are on the brink of losing money because the gap between billet and rebar is at 150-200 yuan per tonne, which is the same as re-rolling...