The situation in the Asian billet market has improved late last week as rising futures prices have prompted traders to buy more ex-ASEAN billet cargos, seeing demand in China is gradually rising. As a result, sentiment in Southeast Asia’s import billet market has become stronger too.
A Vietnamese producer managed to sell 40,000 mt of billet in total by two lots at $661/mt FOB and $670/mt FOB last Friday. The final destination will be China with the CFR price assessed by a number of sources at $695/mt CFR, according to SteelOrbis’ information.
As reported on June 4, ex-Vietnam billets were traded at $675-683/mt FOB, translating to $700-708/mt CFR China and signaling a revival in demand. But then during most of last week, bids for import material in China were fluctuating at mainly $675-685/mt CFR. Following rises in futures, import prices increased on Friday again and market sources hope that demand from China will keep improving gradually.
In addition, 20,000 mt of ex-Indonesia BF billet has been sold at $700-702/mt CFR to a trader with the final destination not named by the time of publication and for now it could be taken as a position, sources said. “It will most probably go to China later,” a trader commented.
Some latest offers on Friday were reported at $710-720/mt CFR China from different sellers, offering BF or EAF billet. And though this level is too high for customers now, if futures and local prices in the country keep going up in the coming days, this may push up import billet prices further. Market sources expect to see a clearer trend in China tomorrow, when the market will restart after the holiday. “I think China is firming up again and will likely be the highest paying market again,” a trader said.
Following better moods in China, the fundamentals have improved in the Southeast Asian billet market. The deal price level for IF billet was at $680/mt CFR in the Philippines last week, while the tradable level for BF billet was at $690-700/mt CFR. Sources said that demand has started to gradually improve and $700/mt CFR is assessed to be “acceptable” for buyers in the Philippines, if they need to purchase now, traders said. One seller is targeting $715-720/mt CFR, but market sources are waiting for China to come back first.