News Room - Steel Industry

Posted on 10 May 2024

ASEAN longs buyers tread cautiously, Chinese prices volatile

ASEAN import markets for long products continue to be muted, Kallanish notes. While offers are stable, the volatility in Chinese steel futures is likely causing regional buyers to exercise caution. The SHFE market has been correcting downwards after a rally at the start of the week following China’s Labour Day holiday.

In Vietnam, bids are still being invited for 6.5mm upwards SAE 1008 wire rod from several Chinese mills for end-June shipment at unchanged levels of $530/tonne cfr Vietnam. A trader understands this offer is for wire rod which will circumvent VAT payment.

A Vietnamese mill manager says that suppliers need to resort to non-VAT wire rod because current offers that are VAT-compliant, at around $550/t cfr Vietnam, will not find any takers. This is because of Vietnam’s 6.2% safeguard import duty on wire rod.

Offers in the Philippines for China-origin June-shipment wire rod which is VAT-compliant remain at around $550/t cfr Manila this week. At the same time, quotes for Indonesian wire rod are prevailing at $550-555/t cfr Manila. A Manila trader says he hears that non-VAT galvanized steel is being quoted again but not wire rod so far.

Previously, orders in the Philippines were mostly for non-VAT Chinese wire rod and deals were stuck at lows of $505/t cfr in early April. Kallanish assesses SAE 1008 6.5mm-diameter wire rod at $525/t cfr Manila, unchanged on-week.

In Thailand, Malaysian-origin 6.5mm diameter wire rod is being offered at $550/t cfr and wire rod from Indonesia at $555/t cfr. Regional wire rod imports have lost competitiveness against domestic rod after exporting mills hiked offers to Thailand.

Meanwhile, a Malaysian mill’s direct offer for theoretical-weight rebar for June shipment remains unchanged from last week at around $535/t trucked to Singapore. This is equivalent to $525-530/t cfr Singapore. These offers pertain to 10,000-tonne parcels, while smaller orders would be priced higher.

Kallanish maintains BS4449 500B 10-40mm diameter rebar at $525/t cfr Singapore theoretical weight, unchanged on-week. Other-origin offers for rebar are higher in Singapore. Vietnamese rebar is heard offered at around $550/t cfr and Chinese rebar at $560/t cfr.

Source:Kallanish