Import billet prices have started to increase in Southeast Asia’s import market this week as Chinese traders have been voicing higher offers amid the hike in Chinese futures prices and somewhat better sentiment among Chinese exporters. Nevertheless, ASEAN-based mills have announced a decline in their billet offers as they are still struggling to accelerate sales.
Two major mills from the ASEAN region, from Indonesia and Malaysia, have been officially offering billet to overseas customers at $520-530/mt FOB, down by $10/mt over the past week. “$520/mt FOB is the tradable level now. I think it can trigger some sales,” a trader said. ASEAN mills have still been targeting distant markets like Turkey. With the freight up to $35-40/mt, offers for ex-Malaysia billet, which is not subject to import duty, would be at $555-570/mt on CFR basis. Moreover, in Southeast Asia offers for ex-ASEAN billet from mills are coming closer to Chinese traders’ offers, which may also lead to some sales in the near future, though demand is still the main issue in the region.
Ex-China billet prices have also been reported at $520-530/mt FOB, slightly up by $5/mt on average from late last week.
Most Chinese traders, offering ex-China origin now, have started to give $535-540/mt CFR Manila prices, while last week offers from them for BF billets were at $525-535/mt CFR mainly. Late last week, a deal for 10,000 mt of ex-Malaysia IF billet was done at $510/mt CFR to the Philippines, but “this price is not available anymore, even for IF the targets are at $525/mt CFR now,” a source said.
The declines in ex-ASEAN offers and the increases in CFR prices in Southeast Asia constitute a very unusual situation in the market. “That's because Chinese offers, which form the basis of most open origin prices in the import market are moving up, while ASEAN mills can’t find demand and need to do something,” a Singapore-based trader said.
The SteelOrbis reference price for imported billet in Southeast Asia has increased from $525-540/mt CFR to $535-540/mt CFR.
The lowest offers for ex-Iran billet have been reported at $535/mt CFR Thailand.
The average Chinese billet price in the local market stands at RMB 3,535/mt ex-warehouse, down by RMB 18/mt ($3/mt) from the previous day, but up by RMB 20/mt ($3/mt) since last Friday. This level translates to $452/mt, excluding 13 percent VAT. The SteelOrbis reference price for imported billet in China has settled at $450-455/mt CFR, stable from last week.
$1 = RMB 6.9299
