Suppliers hike billet prices further in SE Asia, demand sustainability unclear

Friday, 23 October 2020 16:28:37 (GMT+3)   |   Istanbul

Offer prices for imported billet have risen further in Southeast Asia by the end of the week as the previous price level in the market has already been confirmed in deals. However, buyers are resisting and the sustainability of demand at the higher prices is questionable.

At least one contract for Russian billet was made to the Philippines at $450/mt CFR last week. This price level may be attractive for customers, taking into account the positive market sentiment and the almost complete absence of lower offers. Only one cargo of Russian billet is still offered at $445/mt CFR, being a position lot, which has been offered for more than two weeks. And this price level does not reflect the market, major sources agree. Also, there has been a rumour of a sale of 30,000 mt of Indian billet at slightly below $445/mt CFR, which has not been confirmed by sources in the Philippines. “This is super low. And I don’t know who can buy 3SP or 4SP 150 mm size [in the Philippines],” a trader commented.

A deal for induction furnace billet from Vietnam has been heard at $447/mt CFR to the Philippines, slightly down from initial offers at $450/mt CFR. Usually customers from the Philippines ask for around $5/mt lower for IF billet compared to EAF/BOF billet.

A contract for 40,000 mt of Russian billet from the Black Sea has been done at $460/mt CFR to the Philippines. Such a high price level is connected with early shipment - in mid-November, while none of the major suppliers has November and even early December shipment billet available. Sources agree that the tradable value for billet from the Black Sea for December shipment is not above $450/mt CFR.

By the end of this week, offers for billet from Russia’s Far East region have increased to $458/mt CFR Manila, while some suppliers have been asking $455-460/mt CFR. “The uptrend is not sustainable. Demand outside of China is slow,” a trading source from the Philippines said.

In Thailand and Indonesia, customers who need to purchase will also have to buy at $450/mt CFR for non-Iran billet, with one deal reported at this level. But the majority of buyers are staying away from the market, bidding at $440-445/mt CFR. Iranian billet has been on offer at $445/mt CFR Thailand, stable compared to last week.

The SteelOrbis reference price has remained at $450/mt CFR so far, stable from early this week and up by $2.5/mt on average from last week.

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