A further price increase has been fixed in new deals in Asia recently. Though Chinese customers have been more cautious, many exporters have still been aiming at China and some of them have managed to conclude deals. Southeast Asian customers, which have needed to restock, have also been forced to pay more. The sustainability of the uptrend is questionable, sources have said.
An Indian exporter has closed deals for billets from Indian and Omani assets to China at $407/mt CFR and to Taiwan, at up to $410/mt CFR recently. “We have been expecting this price from Oman,” a Chinese trader has said.
Also, a lot of ex-Vietnam billet has changed hands at $407/mt FOB, which corresponds to $414-415/mt CFR China. The high price is due to zero import duty on billet from Southeast Asia in China. This price level is equivalent to about $406/mt CFR, if excluding the two percent import duty for all other suppliers.
An Indian mill closed a tender for 30,000 mt of 150 mm billet at $388/mt FOB yesterday, June 10, while all details have not been finalized with the buyer yet, but sources have said that this material will also probably be for China.
A contract for Iranian billet has been signed at $400/mt CFR China this week for July shipment, with sources saying that the relatively close shipment date has played an important role for the customer.
The expectations of most market sources are not very optimistic as the interest in buying in China has already been impacted by lower futures prices and the slowdown of rebar demand due to weather conditions.
In the Southeast Asian market, buyers in the Philippines have been the most active in inquiries recently. Some rolling mills have been resisting higher prices and have some time to wait. But those who need to buy have had to pay $405-410/mt CFR, with a sizable volume of ex-CIS billet traded at this level recently. Last week, the tradable level was $395-400/mt CFR Manila. “Some people might bite at the current high billet price and think it is time to buy because the recovery is on. But some people may see valid reasons to hold off from big purchases,” a re-roller from the Philippines said. Also, there have been sales of almost the same sizable volume of 100 mm size billet at $400/mt CFR in the Philippines.
Most offers from Russia’s Far East, the Black Sea region, India and some other suppliers have been at above $410/mt CFR Manila, a number of sources said.
Customers from Thailand have been receiving offers at $395/mt CFR for Iranian billet, which has been the most competitive. Billet of other origins has been at $410/mt and above, as well as in the Philippines.
