The trend in the import billet market in Asia has started to change to positive in the last working days before the Chinese New Year holiday, as Chinese customers have resumed purchases and the outlook is more positive for the late February period.
According to sources, the leading Vietnamese billet exporter has sold two lots of 20,000 mt of billet each at $537/mt FOB and $540/mt FOB to China, which translate to $547/mt CFR and $550/mt CFR, SteelOrbis has learned. Billet from Southeast Asia is not subject to 2.5 percent import duty and buyers can enjoy short lead times. There has been a rumour about negotiations by an Indonesian seller with a Chinese trader at $545-550/mt CFR, but the conclusion of the contract has not been confirmed.
The workable price level for imported billet of non-Southeast Asian origin to China is at $535/mt CFR, taking into account these latest deals.
Market sources have also widely discussed an offer from Russia’s Far Eastern ports at $525/mt CFR for 3SP billet and $535/mt CFR for 5SP to China. Some even said that a deal for a total of 25,000 mt of billet has been done with additional discounts, but none of the market participants has managed to confirm this. “Way too many rumours...zero confirmations,” a trader said. This cargo has also been offered to the Philippines at $545/mt CFR. “The two largest buyers SteelAsia and Pagasa have not bought anything. To sell to smaller buyers, then many buyers will be needed to consolidate and I just don’t think that many of them are in the market right before the Chinese New Year,” a trader said.
Also, sources have reported a recent tender from India closed at $515/mt FOB or just slightly above, with the material expected to go to China. The freight from India to China is estimated at $20-25/mt.
As China resumed import billet buying, the sentiment in the Southeast Asian market also improved even despite sluggish demand. “In the last two days, the market seems to be firming up a bit due to buying interest from China,” a local source from the Philippines said. And though the latest buyers’ price ideas were at $540/mt CFR Manila, they are expected to go up soon as bids from China have already increased to $550-555/mt CFR China.
The SteelOrbis reference price for imported billet in SE Asia has remained at $545-550/mt CFR. “Prices are rising now. I think we will see $570/mt CFR soon,” an exporter said.