Chinese customers have remained interested in import billet purchases owing to the firm local market, with a small change seen in deal prices compared to last week. In Southeast Asia, demand has started to improve, but the main customer, the Philippines, has yet to come back to the market and is expected to resume buying within one to two weeks.
A contract for 45,000 mt of Russian billet from Black Sea was signed at $366/mt CFR China for June shipment last week. There have been rumours of another ex-CIS deal from the same region at $368/mt CFR to China this week, but the information could not been confirmed by the time of publication. A contract for 40,000 mt of Russian billet from the Far East was also slightly lower than $370/mt CFR last week.
At the same time, the latest deal for Indian billet was still at $370-375/mt CFR China this week. “The price difference [between ex-India and ex-CIS deals] is small and can be connected with the longer voyage for Russian billet,” a large trader said.
Though China has remained the main billet importer in Asia so far, demand from Southeast Asia has started to revive. About 40,000 mt of Iranian billet have been sold to Thailand at $370/mt CFR and a smaller volume has been traded to Indonesia at closer to $365/mt CFR. The workable level for non-Iranian billet has been at $370-375/mt CFR, with a deal for Russian billet to East Asia at the higher end of the range. The number of firm offers to Southeast Asia has been limited and mainly at the same price level as a week ago, at $375-380/mt CFR.
The main long steel producer in the Philippines SteelAsia Manufacturing is preparing to restart operations at its rolling lines on Luzon Island. “We are hoping for a resumption by mid-May. But that is still tentative,” another producer told SteelOrbis. Some traders have said that SteelAsia has started to invite offers, planning to buy in the coming weeks, but demand will depend on the pace of reduction of high inventories, which have been built over the past month. “There is no aggressive offering to the Philippines, because suppliers know there is no serious intention to buy during the lockdown period,” a local source said.
In the current market conditions, market participants do not expect a further price decrease in the near future.