Prices for Asian billet have still been almost stable this week, signaling that the market lacks drivers until the trend settles in China. Billet offers from China have been corrected slightly down early this week, but it has still not been enough for a trend to settle, with most deals and negotiations in Southeast Asia’s import market at the levels seen in late August.
The ex-China billet reference price is at $430-440/mt FOB this week, down by $5/mt compared to late last week. “Yes, offers are at $435/mt FOB, but some deals to traders at $430/mt FOB are easily achievable,” an Asian trading source said. “Basic conditions are stable since steel output and inventories are on the higher side, while a better consumption season is yet to be seen,” a Chinese trader noted yesterday, September 2. Despite the production cuts announced in Tangshan for the period from August 16 to September 3, which were expected to result in a loss of 90,000 mt of steel production per day, in fact the output restrictions were less strict, sources said, and mills have already started to increase production today, September 3.
As for trading activity to the main sales destinations, Chinese billets have been mainly traded to neighboring markets like Southeast Asia. In particular, a deal for 10,000 mt of Chinese 3SP billet was done to Thailand at $454/mt CFR late last week-early this week, while another booking has been rumored at $455/mt CFR. This is in line with offers for this grade voiced last week in Southeast Asia. “We have offers for 5SP billet from China also at $455/mt CFR, if there is a firm bid,” a buyer from Indonesia added. A week ago, a 5SP billet deal was reported to the Philippines at $455/mt CFR as well. “I would say the current price for billets here is $450-455/mt CFR and China is unchanged, so we will be at this level for some time,” a Manila-based source said.
The SteelOrbis reference price for import billet in Southeast Asia has remained stable at $450-455/mt CFR.
The leading Indonesian mill has been inactive with official offers staying almost stable at $445/mt FOB on Monday and then at $447/mt FOB, as the seller is not very interested in pushing sales of billets for November shipment and is waiting for a clearer trend in China.