Posted on 07 Apr 2023
Billet export offers are falling in Southeast Asia, Kallanish notes. The market is quiet amid holidays in certain regional markets.
An Indonesian blast furnace mill lowered its 5sp grade 130mm/150mm billet export price for May/June shipments to $560-565/tonne fob on Thursday. This offer price gives a "very bad sign to the entire market”, a Manila trader says. Freight is estimated at around $15-20/t to Manila. The mill's offers were $10-20/t higher early this week. Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet at $580-585/t cfr Manila, down $15 on-week.
A Manila re-roller saw an offer for 5sp billet on Tuesday this week at $580/t cfr and he believes there will be more unwinding of traders’ positions. “It takes time but fundamentals will always rule the day. All the artful strategies trying to maintain elevated billet prices have come back to bite them [suppliers],” he says. He described billet trading as being “speculative and opportunistic, more than before”.
A Singapore trader expects revived trading activity after the Philippines market returns from holiday next Tuesday. He believes that any offer at $580/t cfr for 5sp last Tuesday was from “someone going aggressively short or selling a long position at a loss”.
The same Indonesian mill has offered 3sp 150mm billet at $570/t cfr Taiwan. Two Singapore traders hear the cargo was booked despite Taiwan’s Tomb Sweeping holiday on 5 April. A Kaohsiung trader is aware of the price but is unsure if any deal concluded at this level. The Indonesian mill's premium for 5sp billet over 3sp billet is $10/t; freight to Taiwan is roughly around $20/t.
The mill seems desperate, an Indonesian mill manager says on the drop in export prices. But he believes the producer will raise its prices once it has sold enough tonnage.
Meanwhile, the rebar import market in Singapore remains soft. A Vietnamese blast furnace mill is offering theoretical-weight rebar at $650/t cfr. “That is the official number but a firm bid at slightly lower is likely to go through,” a Singapore trader observes. Last week, it sold around 30,000 tonnes of rebar at $635/t cfr Singapore and another 25,000t at $645/t cfr Hong Kong actual-weight basis.
Malaysian rebar is currently offered at $645/t delivered Singapore, or around $635/t cfr Singapore. Offers for Middle Eastern rebar are not heard, trading sources said on Thursday. Kallanish assessed BS4449 500B 10-40mm diameter rebar at $635/t cfr Singapore theoretical weight, unchanged on-week.
Source:Kallanish
