Posted on 06 Mar 2023
Philippine re-rollers are turning to induction furnace billet as a cheaper alternative compared to blast furnace and EAF billet, Kallanish notes.
A 10,000-tonne cargo of 130mm square minimum 0.65% Mn 5sp grade Vietnamese-origin induction furnace billet was booked in the past week at $620/tonne cfr Manila. The April-shipment cargo was ordered either on 28 February or 1 March, Philippine trading sources say.
A Chinese trader is heard to have recently sold Vietnamese induction billet at $622-623/t cfr Manila. Traders report seeing an offer for prompt, March-shipment Thai 130mm induction furnace billet, for 3sp grade at $610/t cfr and 5sp modified grade at $620/t cfr, each for 5,000t.
Several Chinese billet position cargoes continue to be offered. A 10,000t cargo of Chinese Q275 150mm for April shipment was heard on Friday booked at below $625/t cfr Manila. A trader was also seen offering 130mm/150mm Q235 billet for April shipment from an array of Chinese mills at $605/t cfr Manila. Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet at $625/t cfr Manila, up $10 on-week.
Philippine buyers were noticeably booking in the low $620s during the week. “That is why the induction furnace billet prices are being accepted by the second-tier customers,” a Manila trader says. He has heard Middle Eastern EAF billet offered at as high as $655/t cfr Manila.
Another trader says buyers would be willing to pay at least $5/t more for EAF/blast furnace billet over induction furnace billet. Their willingness to pay would depend on the market trend, availability of offers, requirements and inventory levels, and their reading of the market and other factors, he says. He notes: “There were times in the past when there was hardly a price difference between 3sp and 5sp grade billet.”
Regional fresh-production blast furnace billet is now priced higher, at $645-655/t cfr Manila. An Indonesian blast furnace mill’s offer for 3sp billet is now pegged at $620/t fob and for 5sp billet at $630/t fob, a regional trader observes.
The market is likely to continue rising. Vietnamese mills are hiking billet offers too because of the uptrend in scrap. Induction mills were able to accept a sales price for end-April billet shipments at $595-600/t fob, but they are now asking for $605/t fob, a Hanoi trader noted on Friday. “If scrap keeps hiking, they will raise their billet offers further,” he added.
Source:Kallanish
