Southeast Asian billet importers have faced higher prices this week and some rare deals have already been signed at new levels. Bullish moods among major suppliers and the positive outlook for the Chinese market after the holidays have contributed to the recent price hike. Moreover, prices even $10/mt higher have been confirmed in the latest contract to East Asia.
The contract for 20,000 mt of ex-Russia billet has been done at $615/mt FOB Russia’s Far East region, with the final destination being the Philippines and the CFR price is assessed at $655/mt CFR or slightly above. Most offers have been heard at $660/mt CFR, but after this deal was done, an offer from the same mill has already been reported at $670/mt CFR Manila on Wednesday, January 26.
This means that prices have risen significantly from last week's tradable level of $635-640/mt CFR. “Counter offers [from importers] are between $650-655/mt CFR now,” a Manila-based buyer said, adding that the market is not very exciting, but there have been no lower prices any longer in the region.
As reported earlier this week by SteelOrbis, Taiwan has been accepting higher prices for import billets, which were increased in a few separate steps. The latest booking from Russia was at $660/mt CFR this week, up by $5/mt from last week’s deal for the same origin. Indonesia sold at $650/mt CFR Taiwan slightly earlier, but also this week, showing a $8/mt increase from the previous ex-Indonesia transaction to Taiwan.
Even higher deal prices have been reported in other East Asian countries - South Korea in particular. A lot of 20,000 mt of Indonesian billet was traded at $658/mt CFR to a South Korean rebar producer. But after that, a number of sources claimed the same seller sold at $640/mt FOB or $670/mt CFR South Korea. “They have sold a lot at $640/mt FOB [to South Korea]. This is too high for SE Asia right now, but the price will eventually reach that number two weeks after the Chinese New Year,” a trader from Southeast Asia commented.
“A supplier in Malaysia has already got bids at $635/mt FOB,” a trader said, though details have not been disclosed by the time of publication.
Demand for imported billet in Indonesia and Thailand has lagged much behind and bids have been among the lowest in the region. In total, 40,000 mt of ex-Iran billets from a trader were sold at $615/mt CFR to Thailand last week. But this week offers have increased to $620-630/mt CFR. A deal for 20,000 mt of ex-Iran billet has been reported to Thailand at $625/mt CFR this week. “I think the price should be at $630-640/mt CFR soon,” a Bangkok-based trader said. Even though the gap between ex-Iran offers from traders and other origin billets is big, customers are resisting the uptrend, claiming a weak rebar market. An offer from a major Indonesian producer in the local market has been at $655/mt CFR early this week.
The SteelOrbis reference price for imported billet in Southeast Asia has been at $650-660/mt CFR, up by $15-20/mt from last week.