Import billet offers have declined further in the Southeast Asian market, but trading has remained almost at a standstill since buyers, in the Philippines in particular, are still very negative and are waiting for offers hit and drop below the $500/mt CFR mark. The recent news about steel production cuts and real estate market support have failed to support sentiment in the Southeast Asian market.
Offers for 3SP billet from traders for both Chinese and ASEAN origins have been at $505/mt CFR Manila, while those for 5SP have been at $510/mt CFR. Last week, most offers for 5SP billet were at around $518/mt CFR. But bids from Filipino buyers have moved down accordingly, with $500-505/mt CFR seen as the highest tradable level for 5SP now. “$505/mt CFR is the level at which traders are asking buyers to bid, but there are no deals. Prices are still soft and buyers are aware of this,” an international trader said.
Moreover, expectations for the coming weeks are not promising either. “If one can wait until the end of September, you might see prices below $500/mt CFR,” another trader said. As one of the main reasons for this he pointed out that supply is higher than demand, with supply coming not only from the ASEAN region and China, but from Russia as well. The latest deal for ex-Russia 3SP billet to Taiwan was reported at $495/mt CFR early this week. The indicative level for ex-Russia 5SP billet to the Philippines has been at $505/mt CFR, with suppliers not being very active at the moment.
Import billet prices in Southeast Asia have weakened even despite some slight rebound seen in official offers from China, which have reached $500-510/mt FOB again, versus $490-510/mt FOB seen early this week. “Production cuts are important but we don’t see them. The Chinese market is not strong as it could be,” another trader said.
In Thailand and Indonesia, new bids have not been voiced above $490/mt CFR, versus ex-ASEAN offers at $510/mt CFR and the ex-Iran indicative levels at $495-500/mt CFR.
The SteelOrbis reference price for imported billet in Southeast Asia has settled at $505-510/mt CFR, down by $5-10/mt over the past week.