ASEAN rod awaits China return, sees Russia supply
The import markets for wire rod in Southeast Asia were quiet during the past week, Kallanish notes. While market participants were not active at the start of the Lunar New Year, suppliers remain bullish. They are vying for a demand rebound when China fully returns to the market after the festivities.
In Manila, China-origin wire rod offers were heard last week at $630/tonne cfr Manila and for regional ASEAN wire rod at around $670/t cfr. Offers are not available this week, a Manila trader says. “Chinese traders and mills are still on holiday. Even customers are not inquiring for the same reason,” he observes.
Kallanish assessed SAE 1008 6.5mm diameter wire rod on Thursday at $630/t cfr Manila, unchanged on week.
Mills in Indonesia, Malaysia and Vietnam are now targeting to export blast furnace 6.5mm diameter wire rod at $690/t cfr Thailand, Thai trading sources say. Last week, the offer from Malaysia was at $675/t cfr. There have been no deals at these elevated levels.
Easier access to Russian wire rod in Thailand will affect the market. A Thai company is being set up to distribute wire rod from a certain Russian mill in the domestic market. This will enable Thai buyers to pay in local currency and remove the complications of foreign currency payment.
“They [Thai-registered distribution company] plan to use Thailand as a regional hub to re-export as well,” a Bangkok trader says. As Russian wire rod is cheaper than other origins, more supply of this product adds “a lot of pressure” to traders and local mills too, he opines. In early December, Russian material was around $15/t cheaper than domestic product.
The Russian mill shipped a cargo comprising 10,058 tonnes of wire rod and 31,665t of wire to Thailand last November, according to data collated by the Iron and Steel Institute of Thailand. The supplier previously shipped some 44,000t of wire rod last September. Another 41,000t cargo from the mill is on its way to Thailand, regional trading sources reported hearing earlier this month.
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Anonymous
Very good overview of the weekly steel market.
Anonymous