Higher prices for billet and rebar in China over the past week have led to an increase in offers from ASEAN region-based suppliers early this week. However, buyers are still cautious and only rare deals have been signed at higher levels.
Ex-Indonesia billet offers have increased by $5/mt since last week to $505/mt FOB for base 3SP billet. The tradable level is assessed at $500/mt FOB, up from the previous deals at $490-498/mt FOB for 3SP/5SP. At the same time, one deal for 10,000-20,000 mt of ex-Malaysia 5SP billet was closed at $505/mt FOB to a trader late last week. “The trader who took this position last week has not found a buyer yet,” one of Asian traders commented, adding that prices may go up further this week and, in this case, the seller will have a greater opportunity of signing a deal with an end-user. “They [mills] tried to raise prices, but no luck so far. However, traders can sell some positions [a little higher],” another Singapore-based source said.
In particular, there has been talk about 20,000 mt of ex-Malaysia 5SP billet sold through a Chinese trader to the main importer in the Philippines at $517/mt CFR, while the reference price last week was at $515-518/mt CFR, with bids closer to $510/mt CFR. “This is the correct price, for an earlier position,” a source commented. In addition, a parcel of 1SP Indonesian billet is rumoured to have been traded at $518/mt CFR in the local market, which, however, could not be confirmed by the time of publication. “The price is high, but Iranian offers were not competitive at $510/mt CFR and above,” a source said. New offers from traders for Asian origins to the Philippines and Indonesia are starting from $520-525/mt CFR.
Alternative billet suppliers have also been targeting higher prices. The latest offers for ex-Russia 150 mm billet to Taiwan have been reported at $500/mt CFR. A deal for the same origin was done at $495/mt CFR late last week, up from the contract price at $490-493/mt CFR reported a week ago.
The ex-China reference price for 3SP billet has increased by $5/mt to $505-510/mt FOB and exporters have been inactive. “Offers from China are too high and driven by the local market, I don’t see much allocation in exports,” a Chinese trader said. The average local Chinese billet price has reached RMB 3,593/mt ex-warehouse on November 7, according to SteelOrbis, which is up by RMB 68/mt ($9.5/mt) over the past week. This level translates to $443/mt, excluding 13 percent VAT.
$1 = RMB 7.1776
