Offer prices for ex-Asia billet have increased early this week, following the rebound in the Chinese market after the easing of the trade war between the US and China. Nevertheless, trading has been limited as buyers have not seen any drastic change in fundamentals, while most of the recent increase has been based on sentiments and expectations, at least so far.
The SteelOrbis reference price for ex-China has settled at $425-430/mt FOB, up by $5/mt from late last week. This reflects the tradable prices at the moment, though most offers have been already reported at $435/mt FOB or above. On Monday, the US and China announced a 90-day pause on "reciprocal" tariffs starting from May 14, which will lead to the US tariffs on Chinese imports retreating from 145 percent to 30 percent, while Chinese tariffs on US imports will fall from 125 percent to 10 percent, which has exerted a positive impact on market sentiments. As a result, today, the average billet price in China stands at RMB 2,978/mt ($414/mt) ex-warehouse, up by RMB 30/mt since Friday.
Most activity in offering billets from China abroad has been seen from international and regional traders, while Chinese mills have been not so confident, seeing an unfavorable change in the exchange rate. The official PBOC exchange rate has moved from $1 = RMB 7.2095 last Friday to $1 = RMB 7.1991 today.
In Southeast Asia’s import market, offers for Chinese 5SP billet have been at $457-460/mt CFR to the Philippines at the lowest, while the previous deal for 5SP 130 mm billet was reported at $447-450/mt CFR Manila last week.
To Turkey, traders have been more active in offering Chinese billet, at $470-475/mt CFR, versus $466-470/mt CFR reported yesterday.
Buyers’ price ideas in the major destinations have been at least $10/mt lower.
The major Indonesian mill has announced its billet price at $440/mt FOB, increasing the official offer by $5/mt since last week, while its slab offer stands at $445/mt FOB, both for July shipment. “Dexin is following China. I don’t see many sales from their side,” a trader commented.
