Chinese customers have continued to buy imported billet and to support market sentiments, as suppliers have managed to sell to large volumes to China at higher prices. About 100,000 mt in total of ex-Malaysia and ex-Vietnam billet have been sold to China at $415-420/mt CFR this week, while the previous contracts were done at $405-407/mt CFR maximum, SteelOrbis has been informed.
Most of the volume has been traded near to the lower end of the range, while some ex-Malaysian billet has been sold at higher prices, at up to $420/mt CFR for prompt shipment. “Delivery of one cargo is scheduled for early December,” a trader said.
Chinese customers have decided to accept the price increase, seeing the gap between local and import prices as the uptrend has continued in their domestic market. The import price of $415/mt CFR, including import tax and 13 percent VAT, is about RMB 112/mt or $16/mt below the average local price in China, according to SteelOrbis’ data.
New transactions to China will give support to prices in Southeast Asia, because demand there is still limited and most buyers there have been reluctant to accept price increases. Sources said that, even although sporadic deals have been done in the region (in Thailand at $415/mt CFR specifically), the workable level for customers has not exceeded $405/mt CFR yet.
