Posted on 19 Jun 2023
A recent Vietnamese rebar booking to Singapore has sparked interest among traders, Kallanish notes. They discussed the possible reasons for the transaction and the deal price.
A 40,000-tonne cargo of theoretical-weight rebar for August shipment from a leading Vietnamese mill was ordered during the week of 16 June at around $560/tonne cfr Singapore, Vietnamese mill sources say. Singapore trading sources heard that the booking price was $540/t fob which tallies with the estimated $20/t freight cost.
As suppliers were seen hiking offers the past week, some considered the price to be fair. “It is a good price for the buyer,” a Vietnamese trader says. A Singapore trader tells Kallanish on Friday that he just received an offer for open origin rebar at $578/t cfr for September or October shipment. “This is too early to consider” because he deems the price to be too high.
When compared to a Malaysian mill’s rebar offer at $560/t delivered by truck to Singapore on Thursday, which is equivalent to $550/t cfr, the $560/t cfr Singapore booking appears to be less competitive.
The cargo likely contained “special length” rebar which could explain why the buyer accepted the price of $560/t cfr, the Singapore trader says. He was also informed that the booked cargo was to fulfil a previous forward contract.
It is hard to pinpoint when this forward contract was signed. “It can be anywhere from late last year,” another Singapore trader says. The mill’s production of non-standard lengths such as 6m, 9m, 11m or 14m as opposed to the standard length of 12m is one of the Vietnamese mill’s advantages, the second trader says.
Source:Kallanish
