The uptrend in the Southeast Asian billet market has been gathering momentum in late July, which has been supported only by demand and higher prices to China, while overall situation in the Philippines, the major buyer in SE Asia, has remained subdued. A few deals for imported billet at improved level to the Philippines have been done just to replenish stocks, SteelOrbis has learned.
A contract for 5sp 150 mm billet from China has been signed by the major rebar producer in the Philippines at $725/mt CFR for its Davao plant. The final volume has not been disclosed, but most market sources agree that it was not less than 20,000 mt. Due to higher freight and specific uncommon size on billet for the Philippines, this price has been assessed as high for the most customers in Manila.
Nevertheless, a small volume deal for ex-Japan 120-130 mm billet has been also reported at $725/mt CFR, which has been attributed to the need of the buyer to replenish stocks. Also a rumour about ex-Far East Russia billet has been heard at $725-730/mt CFR, but this information could not be confirmed by the time of publication. “Only China driving up the market,” an international trader said. “Domestic rerolling and drawing markets are bad, but some importers needed the supply. So, I cannot say that Manila is following the trend in China. [This increase in price is] more due to need, than real demand. The Philippines are the same as other ASEAN, very bad,” a local trader from Manila said.
In the middle of the month, some tonnages of IF billet have been booked to the Philippines at $685-690/mt CFR and offers could be found still at below $700/mt CFR, from India, for instance, “so most buyers who can accept IF will just go for that, since price gap is so big,” another source said. “I do not see a market at above $705-710/mt CFR,” an importer from the Philippines said, evaluating the tradable price level for EAF/BOF billet. Last week, a deal for ex-Vietnam EAF billet was rumoured at $705/mt CFR, but all offers have gone up since then.
Now, most large importers from both the Philippines and China are receiving offers at $730-735/mt CFR, but this level has not been accepted in China yet, sources said.
The SteelOrbis reference price for imported billet (excluding IF) in Southeast Asia has surged by $20/mt over the week to $725/mt CFR on average.