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Low-priced billet offers weaken market mood in SE Asia - 13 October 2011

Low-priced offers of billet position cargoes are dampening market sentiment in Southeast Asia. Some 20,000 tonnes of 120mm or 130mm square Black Sea billet for December shipment was offered this week at $645/tonne cfr Thailand. “The market is being shaken by this offer,” a Thai trader tells Steel Business Briefing.

Another parcel of 150mm square Black Sea billet, for January shipment, is offered at $630/t cfr Thailand. "It's cheaper because it’s January shipment – too far away for many buyers," another says. The 150mm size is less popular too.

“Buyers have no serious interest to book because they think prices might go down further," the trader says. Also, Thai re-rollers have more immediate concerns about rising flood waters affecting their steel mills in Samut Prakarn and Samut Sakorn. Offers were previously at $670-675/t cfr.

A Black Sea billet lot, also believed to be a position cargo, is currently offered at $650/t cfr Philippines. This low price offer is causing market jitters. Local buyers fear that prices will fall further and are unlikely to take up the offer, local traders tell SBB. "The trader involved wants to cut loses as soon as possible,” a Manila trader tells SBB. Since sufficient bookings at $690-700/t cfr were made last month, importers can afford to wait for prices to stabilise, another says.

Indicative offer prices for Korean and Vietnamese billet in the Philippines are at $675-680/t cfr, down by $5/t from last week. Some Malaysian billet is also currently indicated at $680-685/t cfr Philippines.


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