Activity in the SE Asia’s import billet market has been minimal this week since, even after the resumption of work after the Labor Day holiday, the mood in China has remained weak and most buyers are confident they will be able to get lower prices in the coming two or three days.
Offers for ex-China and ex-Indonesia 5SP billet have been stable to the Philippines over the past two weeks at around $450-455/mt CFR Manila. “Prices are flat. That is why there are no negotiations. They will fall very soon, following futures [in China],” a local trader said. Buyers are waiting for $445/mt CFR for 5SP 150 mm billet at the highest.
Also, Asian origin offers for 3SP to Thailand and Indonesia have been reported at $445-450/mt CFR this week. “But buyers won't pay this, probably because they bought two or three weeks ago and now there is no rush,” a Bangkok-based trader said. Also, at least two importers in Indonesia said that traders have been less active in offering billets this week due to “the unclear trend in China.” Large trading companies are watching the situation in China, which has failed to improve even after the recently announced stimulus measures. The latest deal for Chinese origin billet in Indonesia was done at $440/mt CFR in the second half of April.
Moreover, today, May 8, rebar futures in China have lost 1.74 percent at Shanghai Futures Exchange, and the SteelOrbis reference price for ex-China billet has slipped by $5/mt on the lower end, coming to $420-430/mt FOB. High steel production and insufficient demand have been behind the negative movements.
Though yesterday an Indonesian mill made an attempt to increase its offer by $5/mt, today this move has been scrapped and the offer is officially at $430/mt FOB for July shipment.