Posted on 09 Mar 2020
The Southeast Asian billet import market has weakened amid Covid-19's growing outbreak in Asia, Kallanish notes. Regional mills are resorting to exports as domestic steel demand in affected countries has plunged. “The Asian mills are all thinking of the same thing because they are under pressure to sell out now,” a Manila trader says on recent billet supply from South Korea, Japan and Vietnam.
Billet offers from South Korea have fallen by $10/tonne to $415/t cfr Manila over the past week. Blast furnace billet from Vietnam for April shipment has sold at $415/t cfr Manila in recent days, down from the offered $418/t cfr. The mill is willing now to sell at $413/t cfr Manila, a Vietnamese trader says Friday.
An Indonesian mill which recently started its blast furnace is offering billet for April shipment at $415/t cfr Manila. Its offer is around $410-415/t cfr Jakarta which would be equivalent to around $390-395/t fob Sulawesi, an Indonesian buyer says. While the level of offers for various origins have fallen to around $415/t cfr Manila, buying interest is “… lukewarm,” a trader in Singapore says. He described the market as “… chaotic” with “… no specific direction.” Traders report that 6-metre length billet from Japan was previously concluded at $420/t cfr Manila.
On Friday, Kallanish lowered its 5sp/ps or Q275 120/125/130mm square billet assessment to $413-415/t cfr Manila, down $6 on week.
Interestingly, Chinese importers are flagging buying interest for billet imports in recent days. However, not much buying has transpired because of a price gap. Chinese importers are targeting billet imports at $380-390/t cfr China and are willing to pay up to $400/t cfr. There are no such offers, a Chinese trader says. “The Chinese would want to buy from Japan and South Korea when the opportunity arises,” a Singapore trader says. Plans to source overseas billet is for profitability reasons, for feed to produce rebar for the domestic market. Market expectations are high than the domestic rebar prices will spiral upwards, and this is reflected by the futures prices exceeding those in the spot market.
Source:Kallanish
