Posted on 22 Mar 2023
The billet import market in Southeast Asia has softened after weeks of firmness, Kallanish notes. It has been reeling from uncertainties brought about by the global banking crisis and volatility in Chinese steel futures markets since late last Thursday.
Activity had previously been buoyed by optimism over China’s post-Covid recovery and supply tightness on demand from markets outside Asia, including Turkey.
Indonesia’s Dexin 3sp grade 150mm billet for prompt shipment is now offered at $600/tonne fob, a regional trader says. Chinese traders are currently offering 3sp 150mm billet at $610-615/t cfr, a Manila trader reports. Another trader reports hearing that 130/150mm Chinese/Dexin 5sp grade billet offers are now at $625/t cfr Manila. These offers are $10-15/t lower than last Friday. Freight from Indonesia to Manila is at around $15-20/t.
Traders are offering 3sp 150mm billet for May shipment from Dexin at $627/t cfr Malaysia, compared to $640/t cfr last Friday. The price fall is “very obvious”, a Malaysian importer says.
A Singapore trader guesses that China’s announcement last Friday that it aims to curb surging iron ore prices may have contributed to the price downturn. “This will affect steel prices ultimately,” a Manila trader says. But an Indonesian re-roller notes that China has tried to cool iron ore prices before. The Manila trader sees that low-priced arrivals could also be dampening the market. He hears that orders made months ago are arriving this week – they were booked from as low as $515/t cfr, right up to $600/t cfr.
This latest price drop is unlikely to attract buyers so quickly. "Buyers are spooked by the low prices," a regional trader says.
Source:Kallanish
