The Asian FOB billet market has remained inactive so far with a lack of firm offers from mills, but traders have been more active in offering in short positions to Southeast Asia’s import market, which may result in deals at lower levels after a long pause.
Offers for 3SP and 5SP to the Philippines are at $485-490/mt CFR, moving down by $5-10/mt over the past week, while bids have been heard at $480/mt CFR today, October 17. “There have been no deals for two weeks now, so I think demand will return at lower prices,” a Singapore-based trader said. A Manila-based source said that $485/mt CFR was discussed in the market for a while this week and that new deals should be at $480/mt CFR.
Also, a lack of firm offers has been observed for 3SP billet to Thailand and Indonesia, with buyers’ price ideas falling to $470-475/mt CFR. “I have not heard offers below $490/mt CFR, but the workable level is obviously lower today,” a Bangkok-based source said.
Today’s fall in prices in the local Chinese market due to worsening sentiments after weaker-than-expected stimulus measures for the real estate sector has made traders more confident that billet prices in the region will slip further. The Chinese reference billet price has settled at $460-465/mt FOB with a few large traders announcing offers at this level. Nevertheless, activity in the FOB market has remained weak. “We see lower HRC export offers, but I don’t see firm billet offers yet,” a Chinese source said. Another trader confirmed that some offers were heard at $470-475/mt FOB in the morning today, but later they were withdrawn as “the market is falling too fast.” Market sources believe that prices from China will remain at the current level for some time and that traders will try to sign deals in short positions before confirming deals with mills on FOB basis.
There have been also no firm offers for billet from major ASEAN mills. “We withdrew offers [which were at $500/mt FOB] as the market is close to $470/mt FOB [for ASEAN sellers], but everyone is just watching,” a representative of one mill said.
The SteelOrbis reference price for imported billet in Southeast Asia has lost $10/mt over the past week to $480-485/mt CFR.