Prices of Asian billet have been stable over the past week mainly amid unchanged offers from China, which have been supported by the appreciation of the Chinese currency. The post-holiday outlook varies, but most market sources are rather pessimistic even though positive movements are usually observed after the long Chinese New Year holiday.
The Chinese billet reference price has remained stable at $435-440/mt FOB, with most offers still at the higher end of the range. “Prices are not changing much as mills are all waiting for the market after the holiday,” a large Chinese billet exporter said, while a source in Southeast Asia added that traders do not want to carry risky positions into the holiday period either. So, overall trading has been very slow ahead of the holiday.
“Billet prices are quite stable. Local RMB prices are down around RMB 20/mt, but the appreciating RMB is putting upward pressure on US dollar prices,” a Singapore-based source said. The official PBOC mid-point rate has settled at $1 = RMB 6.9458 on February 10, while the market rate stands at $1 = RMB 6.91.
At the same time, ex-Indonesia billet and slab offers have also remained stable at $455/mt FOB and $470/mt FOB for April and May shipments, respectively.
In Southeast Asia, the market has also slowed down after the previous sales of Chinese 5SP billet at near $455/mt CFR Manila, and sizable ex-Iran 3SP sales at $440-448/mt CFR Thailand. “The restocking is finished, so we all need to wait until after the holiday. No one knows how the market will move, but I personally do not believe in a rebound,” a Southeast Asian source said.
One of the large Chinese traders has said that he expects even some price decline in the first week after the holiday due to “no hopes for demand”. In general, sources in the Asian billet market are skeptical about the port-holiday outlook, at least for now.