Posted on 10 Jul 2023
The Philippine billet market was stable during the week after several re-rollers took in Indonesian billet, Kallanish notes.
Offers for 5sp grade billet for open origins of ASEAN/China for August shipment are at $520-530/tonne cfr Manila, trading sources said on Friday. Three re-rollers booked 50,000 tonnes to Manila from a key Indonesian blast furnace mill during the last week of June at $500/t fob for 5sp grade basis. Two re-rollers booked 20,000t each of 5sp grade billet at $520/t cfr and the third booked 10,000t of mostly 3sp grade at $515/t cfr, with the remaining 5sp at $520/t cfr.
A regional trader reports hearing that a 20,000t 5sp 150mm cargo was ordered at $523/t cfr Davao. As freight to Davao is cheaper than to Manila, the fob price is likely higher. But Kallanish is unable to confirm the deal as other market sources say they have not heard of it. Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet at $520/t cfr Manila, unchanged from the previous week.
A 10,000t cargo of the Indonesian mill’s billet sold to a re-roller in southern Vietnam during the past week at around $530/t cfr. A northern Vietnamese re-roller had previously ordered the Indonesian billet at $520/t cfr during the week through 23 June. “Vietnam steel production was cut for three weeks during June due to an electricity shortage but it has recovered now,” a trader in Hanoi says.
Traders were actively booking billet from the same Indonesian mill for short position-taking during the past two weeks. Some hear the speculators booked up to 100,000t of 3sp/5sp grade billet for August shipment at $500-508/t fob for Indonesia, Vietnam and Thailand. The Indonesian mill’s 5sp billet offered price was consequently raised to $510/t fob for 3sp billet. "But I think $505/t fob is possible now," a Jakarta-based Chinese trader said after Chinese steel futures plunged on Friday.
“It is a traders' game,” a Northeast Asian trader says. End-users are not following the price trends closely and he personally saw 5sp grade billet booked at $520/t cfr maximum. End-users in the Philippines and ASEAN are “crying out” over their current predicament of slow cashflow and high inventories. The Chinese steel market is being fundamentally affected by global economic weakness and poor weather conditions, but the trader anticipates the market should improve in the fourth quarter.
Source:Kallanish
