Posted on 26 Feb 2024
The billet import market in ASEAN is bearish on the slump in Chinese steel futures, Kallanish notes. Offer prices have come down but buyers are preferring to delay their purchases.
Offers for 5sp 130mm square blast furnace open-origin billet from ASEAN/China for April shipment were at $540/tonne cfr Manila. Offers for the same grade but larger, 150mm billet are at just under $540/t.
“I believe that these offers are negotiable if one bids,” a buyer says. This is because iron ore prices have come down. “No one is buying now and demand is slow in Manila,” he adds. He is not however seeing many offers being tabled by suppliers. “It is a Mexican standoff again,” he notes.
“Everything is negotiable these days,” a trader in Manila affirms. "I think the traders and mills will blink first," he adds on the standoff. Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet at $535/t cfr Manila, down $2.5 on-week.
A leading Philippine reroller's purchase of 20,000 tonnes of 5sp grade 150mm square billet at $540/t cfr Manila garnered interest among traders who first heard about the deal on 19 February. They are pondering whether more Chinese billet would be heading into the ASEAN region.
Chinese billet, mostly 150mm square, is less widely used in the Philippines where rerollers tend to process smaller billet including 130mm square, but this is changing. “It’s more than before as there are now around 4-5 buyers capable of using 150mm,” a trader says. A regional trader notes she expected to see more long products being exported because the Chinese domestic market is weak.
A leading Indonesian blast furnace mill was offering 3sp grade at $520/t fob on 22 February. The mill’s offer was at $535/t cfr Jakarta on Friday, an importer says. But the mill has indicated that approval is required for this sale price. Freight is more than $15/t to Jakarta. The mill is heard to have sold a 30,000t cargo at $515/t fob Indonesia on 20 February. The April-shipment cargo is destined for South America, traders report.
Source:Kallanish
