This week has started with another increase in import billet prices in Southeast Asia. Sellers have been increasing offers, seeing some acceptance of the previous levels by some customers, as well as volatile transportation costs. At this stage, buyers may resist further and pause purchases for some time, market sources believe.
A deal for 20,000-30,000 mt of ex-China 5SP billet was done to the leading mill in the Philippines at $490/mt CFR Manila, which is up from the previous booking done at $480-485/mt CFR to this destination. Though some market sources believe this was for 130 mm material, which usually has $5/mt extras over 150 mm size, the majority of market sources agree that this should be for 150 mm billet as even last week most offers for 130 mm were above $490/mt CFR. In any case, after this deal, offers for Chinese 5SP billet have already reached $495-500/mt CFR - the lower end of the range corresponds to 150 mm, while the higher end corresponds to 130 mm billet.
“Honestly, I wasn't expecting to see $500/mt CFR billets offers in Southeast Asia. But transportation costs also increased by 15-20 percent across the region, including stevedoring, clearing, trucking,” a Singapore-based source said.
Most market sources assess the freight for a medium lot of billet from China to Southeast Asia at $26-30/mt depending on the port.
The recent offers for Chinese 3SP billet in Southeast Asia have been heard at close to $490/mt CFR, though some buyers still hope to have small discounts.
The reference price for import billet in Southeast Asia has settled at $485-495/mt CFR, increasing by $7.5/mt on average since last week.
The SteelOrbis reference price for ex-China billet is stable from the previous day at $460-475/mt FOB after a small increase seen on Monday. “Rumors regarding agreement between the US and Iran resulted in oil prices correcting down… While local Chinese steel prices are stable after some previous increase, even though demand has not improved much,” a Chinese trader noted.
