Major Indonesian mill Dexin Steel has increased its export offers for its major products - billet, slab and wire rod - today, March 2. In particular, its new billet offers are at $460/mt FOB for April shipment, up $5/mt from its level in the previous few weeks. Most market sources believe that its billet prices have been corrected up together with other products, while the company has failed to push any big volumes of this product abroad recently.
“I don’t think that billet has space to go up, especially as freight will increase for cargoes to the Middle East, and prices are already high,” an Asian source said. There are expectations that freight rates for large cargoes from China and Southeast Asia to the MENA region will increase by $5-7/mt due to risks connected with the escalation of the conflict in the Middle East. The estimations for freight for large cargoes to Turkey and the GCC are at least at $40-47/mt, versus $35-40/mt before.
The ex-China billet reference price stands at $445-450/mt FOB today, based on recent offers, up by $2.5/mt on average from late last week. But market sources explain the increase as being mainly due to the limited volumes offered in the market after the bookings done before the holiday and due to the expected reduction in production in the middle of March. “I can’t say there is an improvement in the billet market, only a small correction,” a Chinese trader said.
As for slabs, the Indonesian producer has also raised its offers by $5/mt, to $475/mt FOB, but the shipment period has switched from May to June after some additional sales.
The highest price increase was for wire rod: the Indonesian mill has announced new offers at $495/mt FOB, up by $10/mt FOB, and now shipments are for May. There have been reports that April shipment contracts were done at $480-485/mt FOB and from now on the producer will be under less pressure from unsold allocation.