Prices for ex-ASEAN billets have been stable over the past week as allocation is rather limited and ex-Indonesia and ex-China prices are now at similar levels, so there is no reason to lower offers much. Though the Chinese steel market has opened after the Mid-Autmn Festival on a negative note, with futures prices and local spot prices gradually moving down, China’s billet exporters have remained inactive amid uncompetitive prices and congestion at ports after active export sales over the previous month and a half.
Ex-Indonesia billet offers have been at $440/mt FOB for November-December shipment today, September 18, stable over the past week. No sizable deals have been heard lately as for most customers it has been too early to purchase for late November shipment. “Some traders could book, though it is risky. I do not see prices changing much in the coming days,” a Singapore-based source said.
At the same time, an offer from Malaysian mill has been officially heard at $465-470/mt FOB, being too high for the market. Market sources have said that for such markets as Turkey, where Malaysia is not subject to export duty, the tradable level could be equivalent to $450/mt FOB or so.
The ex-China 3SP billet reference price has lost $5/mt today, coming to $435-445/mt FOB. There are no serious negotiations at the moment due to the absence of October shipment offers from major mills and with the asking price mainly at the higher end of the range. “Steel futures have been adjusted down by 1-2 percent, while iron ore futures have fallen faster and mills’ margins have improved… The export market is slow and some buyers want fast shipments, while the weak dollar has made trading harder,” a trader noted, adding that the September market will be characterized by mixed conditions before the long holidays in early October. Also, after the previous sales of steel done by Chinese traders, a number of ports, especially in northern China, are facing congestion.
