Posted on 23 May 2024
A pick-up in trading activity for Indonesian billet has caused prices to rise after some weeks of sluggishness, Kallanish notes. The rising SHFE steel futures since last Thursday could be behind the traders' return.
A Chinese trader booked 20,000 tonnes of 3sp grade 150mm square Indonesian blast furnace billet for July shipment concluded on 21 May at $498/t fob. It was bought to cover a short position, trading sources say. The Chinese trader had previously closed an order at $515/t cfr Philippines, Kallanish understands. While this is a loss on the spot contract, and the trader would likely have taken a long position on the Chinese futures. With the current rally in the Chinese futures, such traders may be taking profit from squaring their positions.
A further 7,000t was booked by another Chinese trader at the same price of $498/t fob for the Taiwan market yesterday.
A Chinese trader reports that the Indonesian mill’s offer on 20 May was $495/t fob. This trader was heard to have ordered 5sp grade billet at $497/t fob from the same Indonesian mill last week, also to cover a short order. A trader hears that a Philippine reroller took the 5sp cargo and, based on the fob price paid, it would be equivalent to around $520/t cfr.
Last week, the Indonesian mill was heard in the ASEAN/China region to have sold 3sp grade billet at $490-493/t fob. Within the past few days, there was one other booking at $495/t fob for this base grade and size of billet by a different Chinese trader, some market sources report.
Source:Kallanish