ASEAN-based mills have mainly kept their export prices stable compared to last week as the previous drop had failed to trigger sales and buyers have been focusing on negotiations with traders who have been offering lower prices in short positions. Moreover, futures prices in China rebounded on Monday, so mills have decided to take their time before adjusting prices.
The leading Indonesian producer is still asking for $500/mt FOB for 3SP billet and $505/mt FOB or slightly above for 5SP billet, still almost in line with the previous week’s levels. The largest Malaysian mill has officially been asking at $520/mt FOB, but a number of customers said $510/mt FOB is the real price in negotiations. ASEAN-based mills have not cut prices further as even an additional $5-10/mt decline would hardly accelerate sales and the mills are watching the developments in China.
The ex-China 3SP billet reference price has remained at $490-500/mt FOB, stable since late last week. However, traders, offering Chinese material in short positions, are still aggressive. A few sales for 3SP billet have been reported as having been done to Taiwan at $495/mt CFR, down from traders’ offers at $500/mt CFR heard last week. “The market for debar is not that weak at the moment. Therefore, customers may cautiously approach purchases of new billet cargoes,” a source said. Offers for ex-Russia billet were reported at $505-510/mt CFR Taiwan late last week, but the tradable level has not been above $500/mt CFR, and so no deals have been reported so far.
In Southeast Asia’s import market, the reference billet price has remained at $500-510/mt CFR amid relatively stable offers, but most bids are coming at $500/mt CFR for 5SP from the Philippines and $480-490/mt CFR for 3SP.
The average local billet price in China has been at RMB 3,360/mt ex-warehouse, down by RMB 88/mt over the past week. This price translates to $420/mt, excluding 13 percent VAT. The reference price for import billet in China has declined by $5/mt since late last week to $415-420/mt CFR.
After Monday’s rebound in futures, rebar on the Shanghai Futures Exchange lost 0.83 percent today, May 30, to RMB 3,460/mt, signaling that high steel output and no improvement in demand both continue to exert pressure and prevent prices from recording any rises.