The uptrend in the Southeast Asian billet market has continued and new booking prices have hit and exceeded $500/mt CFR. The tight availability of material in the market has become the main reason behind the increase, though many customers are still resisting it. The recent hike in Southeast Asia has happened even despite the slowdown of demand and the uncertainty in the Chinese market.
The latest deals for Russian and Vietnamese (non-IF billet) have been reported in the Philippines at $505-515/mt CFR depending on the grade, according to market sources, which is around $10-15/mt above the tradable value last week. “The market has already reached $510/mt CFR due to shortage,” one local source from the Philippines said. At the same time, some smaller customers in the Philippines are still resisting the further price increase and bids have been heard at not above $495-500/mt CFR from them, according to trading sources. But “billet supply globally is very tight”, as one source said, and this has continued to push prices up in deals.
Apart from the Philippines, demand in Southeast Asia has been seen in Indonesia for wire rod grade billet at around $505-510/mt CFR. However, apart from latest contracts to the Philippines and Indonesia, bid prices and interest in purchases have been weak in Asia.
An Indian producer has reportedly sold a cargo of 30,000 mt of billet at $476/mt FOB and, though this price translates to $505-510/mt CFR in Southeast Asia, including the trader’s margin, the material is likely to be sold to other destinations - to Sri Lanta or the Middle East - as the billet specification is not very popular in the Philippines, sources have said.
The weakest price ideas for imported billet continues to be found in Thailand and at the same level there have been bids from smaller rebar producers in Indonesia. The latest deal for 30,000 mt of Iranian billet to Thailand has been at $470/mt CFR, in line with the contract reported to Indonesia last week. Some fresh offers have been heard at $475/mt CFR for Iranian billet. As rebar prices have not been moving up in Thailand, billet importers there have not been able to absorb the rising prices.
The SteelOrbis' reference price for imported billet in Southeast Asia has increased by $12.5/mt on average from late last week to $500-515/mt CFR.
The situation in China has not been supportive of the Asian billet market lately. Late last week, bid prices from some traders in China were heard at $470-480/mt CFR for non-Southeast Asian billets. Offers for Southeast Asian and other origin billet have been heard at $500-510/mt CFR and above. Market players are not optimistic towards the prospects for the market in December.
In China’s local market, billet prices in Tangshan have lost RMB 30/mt ($4.6/mt) from Friday, reaching RMB 3,590/mt ($545/mt) ex-works, indicating weaker sentiment in the market.