Low-priced sales of ex-China billet are reported to have been done late last week and early this week in Southeast Asia’s import market. But after two days of increases in futures prices and some production cuts reported in north China, cautious expectations for a rebound in the near future have emerged.
A contract for over 10,000 mt of ex-China billet was signed at $438/mt CFR to the Philippines and a few market sources confirmed that the deal was in fact done, and for 5SP 150 mm billet. However, one importer in the Philippines said that offers at such a low level were coming only for 3SP, which is usually $5/mt cheaper. In any case, the deal price signals that the market has fallen further as offers for 5SP billet, the most popular in the Philippines, were mainly at $445-450/mt CFR last week. “At the moment, offers are still at $445/mt CFR, so not as low as before,” a Manila-based source said.
There have been no new bookings in Thailand or Indonesia. “The prevailing offers into Thailand during the past one to two days have stayed at $445/mt CFR for 150 mm 3SP base,” a Bangkok-based trader said, adding that just on Monday they were at $440/mt CFR and negotiable at even lower levels. Indonesian customers have also been inactive and most buyers’ price ideas for 3SP are below $440/mt CFR.
There has been a rumor about a contract for 3SP billet to Taiwan at $435/mt CFR last week, but it has not been confirmed by the time of publication.
The ex-China reference price has remained stable at $425-430/mt FOB so far, but, while early this week a few trades and negotiations at $422/mt FOB or even below were discussed, traders say that now no one will accept below $427/mt FOB. “Chinese mills had started to lower crude steel production and discuss possible overhauls of some blast furnaces to maintain appropriate outputs… The market is waiting for a clear signal for better demand and a supply volume cut to confirm the price rebound,” a Chinese trader noted. Also, some announcements to support local consumption are awaited tomorrow after the 4th Plenary Session of the 20th CPC Central Committee which finished today, October 23.
The SteelOrbis reference price for import billet in Southeast Asia has settled at $438-445/mt CFR this week, lower than $440-450/mt CFR seen last week amid disclosed deals and offers.