Steel traders in China have defaulted on contracts to supply their customers with some 200,000 tonnes of July-delivery Tangshan-origin steel billet as a result of high spot prices, industry sources told Fastmarkets this week.
Buyers affected by the defaults have had to seek out cargoes in the spot market to meet their immediate needs, they said.
"Buyers can buy seaborne cargoes that will arrive in China soon or purchase port stock if they are in urgent need of material," an import trader in Shanghai said.
China imported 1.57 million tonnes of square billet (HS code 72071100) in the January-May period, which is over 19 times of the 81,639 tonnes imported a year earlier, according to Chinese customs data.
Trading activity for July-delivery billet imports were especially high in May and early June. This suggests that the supply of imports will likely be sufficient this month, market sources said.
Similarly, import trading activity has also been brisk in the past 10 days.
Vietnamese billet was sold at...