Sentiments in the Southeast Asian billet market are still very weak with buyers waiting for further declines and traders active in offering. After the import duty for billet expired in Vietnam last week, regional suppliers have started to offer to the country, which usually only exports billet, but with not much success, at least for now, SteelOrbis has learned from the market.
The lowest offers for 5SP billet from Chinese traders have been reported at $610/mt CFR Manila this week, down from $615-620/mt CFR last week. Some traders’ asking prices are still at $615/mt CFR, but “bids from the buyers are at $600-610/mt CFR in the region,” a source from Singapore said.
Weak construction steel demand in the Philippines and low finished steel prices are likely to keep the pressure on the billet market in the near future. A number of market sources reported small deals for Chinese wire rod at $610/mt CFR in the Philippines last week. “No one will buy billets in these conditions,” a Manila-based source said.
Some suppliers have started to offer to Vietnam since last week, trying to find bids at $610-615/mt CFR, but no deals have been heard by now. The duties for imported billet were standing at 11.3 percent and for bar and wire rod were at 6.4 percent, until March 22, 2023. No announcement for an extension of these duties has been seen so far. Even though there are no import tariffs now in Vietnam, “buyers are not very interested,” one source said. Another trader also shared the opinion that, since the local capacities in the country are enough, even lower import billet prices could not lead to a continuous revival of demand for overseas semis.
The SteelOrbis’ reference price for import billet has been lowered to $610/mt CFR, down by $5/mt from late last week.
ASEAN-based mills’ offers have remained stable from last week at $600-605/mt FOB for 150 mm billet, though sources said that for 130 mm material producers can provide the same level. But taking into account soft demand and bearish sentiments, there was almost no interest in negotiations.
Ex-China billet prices have been at $590-600/mt FOB, stable since late last week, though discounts are possible.
The average domestic billet price in China has declined a bit further over the past week - by RMB 37/mt ($5/mt) to RMB 3,988/mt ex-warehouse. This level translates to $513/mt, excluding 13 percent VAT. The reference price for import billet in China has settled at $510/mt CFR, down by $5/mt over the past week.