Posted on 27 Oct 2021
Billet initially destined for China continues to be offered across Southeast Asia. This is attributed to the unwinding of physical positions when Chinese steel futures crashed last Thursday, Kallanish understands.
An Indonesian steel mill ordered a floating 150mm billet cargo from a leading Vietnamese producer at around $690/tonne cfr Jakarta on 22 October. The mill usually buys 0.8%+ manganese content 5sp billet. Offers for position cargoes for December-shipment were available on Tuesday at $700/t cfr Jakarta.
In Thailand, there was market chatter of several fixtures on Tuesday for prompt-shipment cargoes of blast and electric arc furnace billet at $680/t cif Bangkok or lower. Suppliers are also heard seeking bids for January-shipment cargoes at $675-680/t cif. A Malaysian mill manager reports receiving an offer for Middle Eastern 150mm 3sp billet for November shipment at $700-705/t cfr.
In Manila, 150mm 3sp/4sp/5sp Vietnamese billet for November/ December shipment were offered at $700/t cfr Manila last Friday. These offers are “100% from traders,” a Manila market player says. Besides the above-mentioned deal to Indonesia at $690/t cfr, he also heard billet from the same Vietnamese mill booked at nearly $700/t cfr Taiwan and South Korea.
A regional trader reports hearing that higher-manganese 150mm billet from the same Vietnamese mill was booked by a large re-roller at $695-700/t cfr. Since the mill is still offering its billet at $680-690/t fob Vietnam, it cannot be a direct offer from the mill, traders say. Freight to the Philippines is estimated at $30-35/t.
An offer for Indonesian blast furnace billet was last heard at $705-710/t cfr Manila. That mill is currently offering billet at $690/t cfr China for January shipment, which is deemed high-priced.
Tangshan billet prices shipped by a further CNY 30/t ($5) on Monday to CNY 4,970/t. Importers in China would want to book at below $670/t cfr based on this domestic level, a Chinese trader notes.
“Last week, steel futures in China decreased a lot,” another Chinese trader says. These traders made money on the futures market so they were able to accept a loss when they sold off their position cargoes at lower prices. This is because the fall in futures was sharper than in the spot market, he explains.
Source:Kallanish
