CIS billet prices have so far this week remained at last week's levels, with only one Black Sea sale, although more were concluded from Azov Sea ports. There has also been buying interest from the Gulf Cooperation Council countries, Kallanish understands.

A Russian vertically-integrated producer sold a large billet lot to China at the equivalent of around $335/tonne fob Black Sea, through a trader. Another Russian southern coastal producer is selling its output on a prompt basis, to North African destinations, at around $360-365/t cfr. Its ability to sell prompt is securing the ongoing business.

Meanwhile, several GCC producers are in the market again with large requirements, for June production and loading material. An estimated 150,000 tonnes of billet is due to be transacted, traders estimate. As CIS producers still have plenty of June-casting volumes available, market sources estimate the deals will probably be concluded at the latest sales' levels of $360/t cfr. With freight down by around a third on last quarter, these are practically mills' asking prices, which are at $340-345/t fob Black Sea, they note.

Chinese buying interest is being supported by the moderate increase this week in futures prices. Sources are confident there will be more demand coming from the country in the next two weeks, securing the closure of mills' June-casting books. Expectations of at least a moderate scrap price rebound mid-May are also supporting billet prices.

However, concerns are being raised over increasing stocks of undelivered long products from Russia, and the effect this may have on June production schedules. Without a moderate reduction in output, there could be more billet available than the market can absorb.

Southeast Asia is buying moderate volumes at $368-370/t cfr, one seller notes, but prefers to buy with the shortest lead times possible, which does not reflect on Black Sea ports positively. Some sales were made at this level from Russia’s Far East, he says.

Expectations of Egyptian authorities imminently implementing an additional 10% import duty on billet, rebar and hot rolled coil are likely to affect flat products suppliers more. This is because the region has become less important for billet and longs sales since last year, one producer says.