Prices for ex-ASEAN billet have as expected retreated this week after a short-lived increase. Falling local prices and weak futures prices in China together with adverse weather conditions have put pressure on prices in Southeast Asia and have ended the uptrend, at least for now.
Offers for 3SP/5SP billets from the leading Indonesian mill have been reported at $505-510/mt FOB, down by $5-10/mt from the official offer levels last week. There have been no reports of new deals after the mill sold sizable tonnages at $508-510/mt FOB, as reported last week. “There are no new sales, but I will not be surprised if they sell at $500/mt FOB,” a trader said. Though there have been no official offers, ex-Malaysia billet offers have also been assessed at $505-510/mt FOB.
The prices for ex-ASEAN billet have resumed their declines, following the downtrend which started in the Chinese market. The reference price for ex-China 3SP billet has settled at $495-510/mt FOB, down by $7.5/mt on average from late last week, and down by $17.5/mt from a week ago. “Mills are offering lower, but there are no takers. Bad sentiment has returned,” a Singapore-based source said.
In the import billet market in Southeast Asia, the bearishness has also increased. Traders have been offering 5SP billet at $520/mt CFR Manila, versus mainly $525-530/mt CFR last week. “But bids if they exist would be at $515/mt CFR max,” a trading source said. Offers for Asian 3SP billet from traders have been at $515/mt CFR Southeast Asia. “Everyone was hoping prices would move towards $530-535/mt CFR, but now we are back at $515-520/mt CFR,” another source said.
The average local billet price in China has come to RMB 3,560/mt ex-warehouse, down by RMB 85/mt ($12/mt) over the past week. This level translates to $440/mt, excluding 13 percent VAT. The import reference price has been corrected down by $5/mt to $435/mt CFR.
$1 = RMB 7.1565