SE Asia's EAF-BF billet production cost spread expected to widen in Jan

The production cost spread between Southeast Asia's electric arc furnace and blast furnace billet is expected to widen in January, after narrowing for five consecutive months.

According to Platts' estimates, the spread between the average cost/metric ton of billet produced by EAF steelmakers and the BF-converter route is anticipated to widen to $47 in January from $42 in December. Platts is part of S&P Global Energy.

Platts' estimates for January are based on December raw material prices for delivery one month forward, accounting for 10% scrap usage in the BF-converter route and 100% scrap usage in the EAF route. The EAF calculation assumes a scrap yield of 89%.

The per-metric-ton cost to produce billet via the BF-converter route is estimated at $448/mt for January, down $2/mt month over month, while EAF steelmakers are expected to see a cost of $495/mt, up $3/mt over the same period, according to Platts' calculations.

Platts assessed the average seaborne pulverized coal injection price on a CFR China basis at $126.91/mt in December, down from an average of $129.40/mt in November.

The Platts-assessed average seaborne 62/60 met coke price on an FOB China basis was $218.27/mt in December, down from an average of $228.30/mt in November.

The December average price for Platts 62% iron ore increased to $107.19/dmt from $104.84/dmt in November.

Meanwhile, ferrous scrap HMS 1/2 80:20 grade prices on a CFR Taiwan basis rose $2.40/mt month over month to an average of $298/mt in December, while average HRS101 prices decreased $3.56/mt to $344.59/mt over the same period, Platts data showed.

Platts assessed 5SP 130 mm billet at $460/mt CFR Southeast Asia on Jan. 12, up by $2/mt day over day, while Chinese export 3SP 150 mm spot billet was assessed unchanged day over day at $439/mt FOB China.