ASEAN mills lift billet export prices to China

Posted on 08 September 2021

An improving billet market in China is providing export relief for mills in Southeast Asia, Kallanish notes. Chinese buyers are acceding to mills’ higher export prices because of the uptrend in the Chinese domestic market.

Transaction prices for ASEAN-origin 150mm 3sp blast furnace billet have reached $695-700/tonne cfr China, most trading sources in East Asia say. A leading Vietnamese mill sold 10,000 tonnes to China at $665/t fob Vietnam on Tuesday, a Chinese trader says. He hears the same mill sold a 30,000t parcel at $657/t fob the day before.

However, other Chinese and Vietnamese traders report the mill’s sales price on Tuesday was at $660/t fob. The Vietnamese mill’s booked cargoes are for late-October and early-November shipment. Freight cost is estimated at $30-40/t, depending on Chinese port.

ASEAN mills are now seeking more for billet exports to China and have raised offers to $705-708/t cfr, regional traders report. Regional home markets have been weak amid Covid-19 curbs and lockdowns. “Prices are rising sharply in China only, but not in Southeast Asia,” a Manila trader notes.

“Offers went up yesterday,” a buyer in the Philippines said on Tuesday. “I was chasing a parcel but the trader refused to sell. On Monday morning, they said they sold to China,” he says. He believes the mill was seeking to export at $685/t cfr Manila at that time. An Indonesian mill is currently offering 150mm 5sp billet at $715/t cfr Jakarta and $710/t cfr for 3sp billet.

In China's Tangshan, spot billet rose on Tuesday by CNY 20/t ($3/t) to CNY 5,120/t ($792/t). Prices have gained CNY 60/t since 3 September.

Meanwhile, an Indian mill recently sold a 30,000t cargo at $591/t fob. If the cargo is shipped to China, the prevailing freight cost from India to China is estimated at $80-85/t.

Source : Kallanish