The uptrend in the Asian billet market has continued after the short New Year holidays, since, even though demand in Asia has failed to improve much, ASEAN mills have been bullish, seeing increases in iron ore prices and in steel futures prices in China, and with expectations of a positive January amid stock replenishments in China.
The new official offer prices for ex-Indonesia 3SP billet have been reported at $535-540/mt CFR, increasing by $5/mt from last week. About 20,000 mt of billet have been sold at $530-532/mt FOB to a trader for a long position. “The destination is unclear, but I believe this is again not for Asia or the Middle East, but for the Americas,” a trader said. The new deal price level is $5-7/mt above the previous contract reported last week. “I would say this price is good for the seller, but on the other hand raw material prices are also very high,” another Asian trader said.
Some offers for ex-Malaysia billet have been heard at $530-535/mt FOB, while no new deals have been reported so far.
The reference price for ex-China 3SP billet has been at $540-550/mt FOB this week, with the lower end of the range adding $10/mt from late last week. This price level has been mainly indicative as most suppliers have focused on local sales. The average domestic billet price in China has been at RMB 3,748/mt ex-warehouse, up by RMB 13/mt ($2/mt) over the past week.
In the Southeast Asian billet market, offers have also been on the rise. Traders have been offering 5SP BOF billet at near $545-550/mt CFR Manila, versus the lowest levels at $538-545/mt CFR late last week. “Prices are fully cost-driven, so buyers will have to accept sooner or later,” a source said. The tradable level has settled at $535-540/mt CFR Southeast Asia for both 5SP and 3SP billets. Market sources have said that buyers have limited cheaper options now as no fresh offers have been heard for IF billets from the ASEAN region and “Russia is all going to Taiwan.”
