Posted on 07 Mar 2022
The Southeast Asian billet import market has shot up amid the ongoing Russia-Ukraine war. Certain re-rollers have acceded to price hikes in a market which is reeling from surging raw material costs and global steel shortages, Kallanish notes. The market is changing daily, say traders. “Today’s price will not apply to tomorrow,” a Philippine trader emphasises.
A leading Philippine re-roller ordered a 30,000-tonne cargo of Vietnamese blast furnace 5sp 130mm billet at $760/tonne cfr on 3 March. The Vietnamese mill then hiked its offer on Friday to $795/t cfr Manila, a Manila trader reports. Other offers for regional blast furnace billet were prevailing at $770-790/t cfr Manila on Friday, according to importing and trading sources.
An Indonesian blast furnace mill was offering 150mm 3sp billet at $740/t cif Thailand on 3 March, but traders say this price no longer applies. Some report the mill’s offer could be $20/t higher, while others say the supplier has withdrawn from the market.
The Philippine billet market is currently not seeing disruption to Russian billet trade, particularly in the execution of outstanding contracts. Offers from supplying mills are generally scarce because they want to capitalise on the current “abnormal prices” arising from uncertainty over supply, particularly from Black Sea ports, and sky-rocketing freight costs. “Supplying mills are watching the situation. The market has not peaked yet,” another Manila trader says.
“A major private bank informed their customers earlier this week that they won’t issue any LCs anymore for Russian-origin imports,” a trader said on Friday. “But it’s a private initiative, part of their risk management, and not a central bank mandate,” he adds.
Offer prices are at around $760/t cfr in the region, traders say. The RINL award price on 3 March for 150mm 3sp/4sp billet at $721/t fob India – with full-advance – would amount to about $765/t cif Thailand, a Thai trader says. The cargo would equate to $760/t cfr ASEAN, a regional trader says. While freight is also changing daily, he estimates freight for a 30,000t vessel from Vizag to the region at $40-45/t.
Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet on Friday at $760/t cfr Manila, up $55 on week.
Source:Kallanish
