Posted on 04 Mar 2024
The billet import market in ASEAN is weakening, Kallanish notes. It has turned bearish because of weakness in the Chinese steel market. Rumours are swirling, including whether a transaction has taken place or whether China is planning to restrict the export of semi-finished steel, including billet.
Offers for 5sp 130mm square blast furnace open-origin billet from ASEAN/China for April/May shipment were at around $540/tonne cfr Manila, unchanged from the week before, importing sources say.
Traders were less unanimous about where offers stand. “It is probably lower now,” a Singapore trader says. He heard rumours of a deal for 5sp grade billet which had taken place at $535/t cfr Manila. A Manila trader thought this level was too high. He had a bid at $525/t cfr during the week and saw certain offers already at $535/t cfr.
A regional trader believes quotes are currently at $535-540/t cfr, while another says $535/t cfr was a bid and does not believe deals were concluded yet at this level. Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet at $535/t cfr Manila, unchanged on-week.
An Indonesian blast furnace mill is heard to have sold some 3sp billet cargoes at $516/t fob earlier in the week. Its offer for 3sp billet is officially at $520/t fob. Freight to Manila/Jakarta is estimated at $15-20/t.
Meanwhile, unconfirmed news that China could be planning to restrict or even impose a ban on the export of semi-finished steel circulated in the market during the week. Chinese trading sources say these are only rumours. “It could be a warning to the market because there are no policy documents announced,” one Chinese trader notes. The rumours are believed to have started after central government officials made inspections at certain Chinese mills that are exporting semis.
“If no production cuts are mandated, the [Chinese] mills will have to export their way out of their overproduction,” an ASEAN reroller says. “Chinese steel mills need an export tax like they need a hole in the head,” he says. “I highly doubt if this rumour of pending export tax will amount to anything.”
Source:Kallanish
