Some suppliers of billets have attempted to increase prices in the Southeast Asian market, reflecting the rebound seen in the scrap market lately. But most customers have been saying that this hike is not supported by fundamentals since finished steel consumption in the region is very low and long steel prices are stable or have even continued to go down, market sources told SteelOrbis.
There has been information that an ex-Malaysia 5SP billet lot has been offered to the Philippines at $585/mt CFR this week, and, according to some sources, it has been bought, though this has failed to be confirmed by the time of publication. Last week, negotiations with traders for ex-ASEAN origin EAF/BOF billet were held at $580-585/mt CFR, indicating that the market is somewhat stable. “It's going to take more than just a $10/mt scrap increase to get back billet buyers,” a trader said.
Sources reported that today Dexin Steel from Indonesia has increased billet export offers to $570/mt FOB, which translates to $600/mt CFR Manila or slightly above for a sizable lot. But most sources agree that discounts could be provided as this is an official offer. Also, Vietnamese BOF mills have been offering excessively high prices of around $600/mt FOB, remaining fully out of the market for the moment.
A number of import sources from the Philippines do not see the recent attempts at offer increases by some suppliers as already constituting a change of trend. “The increase has yet to be accepted by the customers,” a source from Manila said. “Sales of finished goods are still slow in most markets here in Southeast Asia, but offers are going up,” a trader from Singapore said. Most offers for EAF/BOF billet from ASEAN are at $580-600/mt CFR, up from mainly $575-590/mt CFR heard last week. At the same time, “Bids for 5SP are at $580/mt CFR and for 3SP they are at $550/mt CFR,” a source said, commenting on the tradable levels in the Philippines.
Among the latest deals, there have been sales of Dexin Steel in the local market in Indonesia at $565/mt CFR, which also reflects the weakness of the market, which has not disappeared.
Offers for ex-Russia and ex-Iran billets to Thailand have been heard at $580-585/mt CFR, but no deals have been reported yet. “Buyers here still have no confidence regarding how sustainable the price increases could be. The local scrap price is still down, by THB 500/mt from early this week,” a source said. Some traders have been testing the market with indications of $550/mt CFR for ex-Iran billets.
The SteelOrbis reference price for imported billet in Southeast Asia has settled at $580-590/mt CFR this week, with the average price being just $2.5/mt higher than last week.