Asian billet suppliers held their offers firm this week in global markets even as Chinese importers reduce imports after showing months of aggression.
Vietnamese billet suppliers are holding their offers for October and November shipments at $440-445/mt cfr China against the bids of $435/mt cfr China. Vietnamese mills held offers on higher imported scrap prices. Offers from other Southeast Asian suppliers, Indonesia and Malaysia remained firm at $440/mt cfr for September and October shipments against bids of around $430/mt cfr South East Asian buyers.
Steel mills in India are holding on to their high offers for billet exports as steel prices improved in the domestic market. Indian exporters were offering billet at $430-435/mt cfr China, with no buyers at those levels, the equivalent fob price is not more than $410/mt fob India, said a Singaporean trader. Most are holding their offers to return to the market with another $10/mt raise while preferring to destock materials domestically where they are witnessing an price hike of at least Rs1,000-2,000/mt ($13.38-26.77/mt) from the prior week.
Strong Chinese market
With the government looking to speed up infrastructure investment in the second half of the year, steel output is expected to remain strong in China. Chinese government infused CNY700bn ($101bn) of MLF loans for the fourth successive month in August. Domestic billet was offered at CNY3,410/mt ex-Tangshan works, down CNY10/mt from Friday.
Rebar prices up
Chinese rebar prices too climbed on anticipation of interest from South East Asian buyers from Hong Kong and Singapore. In the export markets, the prices for 16-20 mm diameter BS500 rebar was last heard at $485/mt fob China on an actual weight basis. In the domestic market, rebar of 16-25 mm diameter HRB400 traded in eastern China at CNY3,640-3,670/mt ($525-530/mt) including 13pc value-added tax, up CNY30/mt from the prior prices.
Mills are expected to maintain prices amid bullish market for steel in South Asia. Most mills focus more on domestic sales and export allocation is less preferred. On the other hand, slow import activities might change if sentiment improves and a few buyers may import despite issues of port congestion. Iron ore futures inched higher on Monday, with the Dalian benchmark contract extending gains for the third session on upbeat demand, although rising supplies tempered optimism.
Domestic ferrous scrap
Chinese steel scrap prices remained high as scrap consumption has increased amid a sharp rise in international iron ore prices. In the domestic market, HMS scrap of 6-10mm traded at $2,750-2,800/mt delivered works.
($1= Rs74.69; CNY6.92)