The general range of import billet prices in the Southeast Asian market has increased over the past week owing to the almost full absence of low prices below $500/mt CFR offered by Chinese traders in short position last week. However, the mood in the market has remained extremely weak due to poor demand and lack of expectations for improvement any time soon.
SteelOrbis’ reference price for imported billet in Southeast Asia has increased by $5/mt on average to $495-515/mt CFR, versus $490-510/mt CFR last week.
In the Philippines, last week China sold 30,000 mt of 3SP 150 mm billet at $490/mt CFR Manila and $497/mt CFR Davao. But this week, most offers even for 3SP and the less popular 150 mm billets are at $500/mt CFR Manila and above. “Prices have increased by $5-10/mt this week. $505/mt CFR would be the lowest for offers including Chinese origin. But there remains little interest in buying now,” a trader from Manila said. “I would think that billet would be tradable at $510-515/mt CFR [the Philippines] soon given that short sellers are on the sidelines,” a trader from Singapore said.
At the same time, ex-ASEAN billet offers have been at $507-520/mt CFR to Southeast Asia with the lower end of this range corresponding to more aggressive ex-Vietnam BF offers not seen previously. An Indonesian mill has been officially offering at $520/mt CFR Manila, but can accept $510/mt CFR if there is demand, according to sources.
In Thailand, the lowest price level is still from China in the middle of this week with at least one trader trying to generate bids at $495/mt CFR. This is down by $5/mt from the previous deal done to Thailand for Chinese billet. Some market sources said that in the current weak conditions traders are just checking the market, while deals at lower levels right now are doubtful. Also, offers for ex-ASEAN billet to Thailand have been at $510/mt CFR. Traders have still been offering ex-Iran billet at $505-510/mt CFR Bangkok.
The outlook in the Southeast Asian billet market has remained pessimistic even despite some increase this week. “The reduction in price is not due to costs. It is primarily the result of demand. There is no demand in the entire Southeast Asia. If supply is still higher than demand, the tendency of prices to go down will continue,” a trader commented. “Demand is definitely going to slow down [in China] and the winter production cuts are fairly normal, which may not be enough to hold up prices,” another international trader said.
