The negative sentiment seen in China since last week has led to a decline in import billet offers in Southeast Asia. As a result, some buyers have been interested in restocking. In general, ex-China billet prices have become among the most competitive again. However, the sustainability of the downtrend is questionable as today, March 12, futures prices have increased again and the outlook is rather uncertain.
One deal for a sizable lot of 5SP 1,500 mm billet was done to the Philippines at $460/mt CFR Cebu, which is equivalent to around $450-453/mt CFR Manila. According to market sources, this was a trader’s deal in a short position. Most of the offers last week were standing at $460-466/mt CFR, as reported earlier, but with the drop in Chinese futures prices early this week and some deals at lower levels already signed, the mood has become strongly bearish in Southeast Asia. A few traders have also confirmed that offers to the Philippines slipped to $455/mt CFR or even below early this week. “Today, the market is firming up, not sure if this level is still available,” an international trader said.
In addition, early this week a deal for 3SP 150mm Chinese billet was done at $443/mt CFR in Indonesia, down from most offers at $455-460/mt CFR last week. A few importers in Indonesia and Thailand received offers for 3SP billet at $450/mt CFR on Monday and were pushing to below $445/mt CFR with some of them successful. “Most agents offer Iranian billet these days because they are worried about a bad performance from China if the price increases,” a Bangkok-based trader said. He also added that offers for ex-Iran billet are stable at $445-450/mt CFR.
In addition, after active sales of over 100,000 mt of billet to Taiwan at $448-449/mt CFR, ex-Russia billet offers have been reported at $450-455/mt CFR to the Philippines.
The SteelOrbis reference price for import billet in Southeast Asia has settled at $443-455/mt CFR this week, down from $455-460/mt CFR.
The outlook for the import billet market in Southeast Asia is now fully dependent on the trend in China. A Chinese trader said that, during the day, futures have been changing direction several times, which reflects the complicated feelings of market sources, while the day ended with a small increase in rebar and HRC futures at the Shanghai Futures Exchange. The Chinese billet export reference price remains stable at $425-440/mt FOB so far.