The leading Indonesian mill has increased its billet offers for October shipment to $435/mt FOB, up by $5/mt from the level seen in the middle of the week and up $10/mt from Monday. Market sources said that there have been no new deals as “that’s too high, today’s real transactable prices should still be at $430-432/mt FOB”, as one international trader said. Two other large traders said that they may only see demand at not above $425/mt FOB.
The recent increase in billet prices from the ASEAN region is due to the futures increase in China, following the news of the Tangshan steel production cuts and the general expectations for structural supply reforms in China. “There was news that the authorities will take measures to reduce air pollution in North China next month,” one Chinese source also said.
Today’s Chinese billet reference price is at $425-430/mt FOB, up by $2.5/mt over the past week, but stable from yesterday, July 3. “Now the export price is linked to futures,” a Chinese trader said, adding that $430/mt FOB would be a fair price for Chinese billets. Some offers have already been voiced at $435/mt FOB, but trading has almost stopped as even $425/mt FOB is said to be represented in very rare price ideas from buyers.