Daily Steel News - 7 Jun 10

Billet importers wait for SE Asian market to bottom out
Billet from the CIS is now being offered at $530-540/tonne cfr Southeast Asia, compared to $540-550/t cfr a week ago, while offers for billet from Turkey are at $550-560/t cfr SE Asia. Regional importers including those in Vietnam and the Philippines are inactive. "Buyers want to wait and see. They are not keen on booking because they expect prices to come down," a regional trader tells Steel Business Briefing. Traders report some small-volume bookings of Russian-origin billet at $530-540/t cfr Thailand and around 30,000~40,000 t of 5sp/ps billet from Ukraine concluded at $520/t cfr Taiwan. Taiwanese trading sources also report that 5sp/ps billet from Russia was recently offered at $520/t cfr, and at $550/t cfr for vanadiumadded billet. Billet from Thailand was recently offered at $560-565/t cfr Vietnam while locally-produced billet there is currently offered at VND 10.5-10.7m/t ($554-564/t) excluding 10% VAT. “The Vietnamese re-rollers want to buy billet but do not want to import. Domestic billet is cheaper now,” an importer tells SBB. An import duty buy billet but do not want to import. Domestic billet is cheaper now,” an importer tells SBB. An import duty of 3-7% is levied on billet entering Vietnam. Regional importers are hesitating in their purchases because scrap prices are still soft and finished steel prices in domestic markets are weak. An optimistic trader says: “Prices are bottoming out. Buyers in the Philippines will be returning soon to book." He believes that US scrap suppliers will not cut their prices further.

Tokyo Steel cuts scrap prices for third time in a week
Tokyo Steel Manufacturing has decided to reduce all its scrap buying prices by ¥1,000/tonne ($11/t) effective from 5 June arrivals. The cut, announced on 4 June, made for the mini mill’s third in a week and took the total reduction to ¥2,500-4,000/t. Behind Tokyo Steel’s decision seems to be the fact that after slashing buying prices by ¥1,000-1,500/t for all works from 3 June, other mini mills clipped their prices in tandem. This resulted in scrap collectors making more deliveries to Tokyo Steel. One scrap trader explains that some mills are limiting arrivals or stopping accepting scrap, but Tokyo Steel is trying to lower its acceptance volumes by cutting prices. He noted that this condition will continue while scrap exports are weak. Last week saw no apparent change in movements of Japanese scrap for export, with prevailing H2 grade offer prices at around ¥33,000/t fob, almost the same as the last contracted price by Korean mills. Inquiries for Japanese scrap traders are not active.