Importers of billet are slow to accept the price hikes sought by suppliers in East Asia, Kallanish notes. Suppliers have pushed offers to near or beyond $700/tonne cfr during the past week, but transactions appear to be few and taking place at just below this level.

An Indonesian mill is offering 150mm 3sp billet at around $700/t cfr in East Asia, including China, Taiwan and the Philippines. An order was taken on 10 February at $685/t cfr Kaohsiung, a local trader says. A regional trader is certain a booking took place last week for the Indonesian billet at $690/t cfr, but is uncertain if it went to China or Taiwan.

Some traders hear of recent unconfirmed deals for the Indonesian billet to China or Taiwan at $695-700/t cfr. A Chinese trader heard on Friday that billet from the same Indonesian mill was booked at $705/t cfr China. "It was a booking to speculate for future delivery against a hedge in the futures market," he says.

Mills remain bullish. A Vietnamese blast furnace mill raised its offer price to $700/t fob on Friday, up $20/t in just two days. The Vietnamese mill’s offer is “way out of the ballpark at $730-735/t cfr Manila,” a Philippine trader says. He hears of a Thai electric arc furnace 130mm billet offer at $710/t cfr Manila. "These rapid price movements are not healthy for everyone in the end," he adds. 

Billet offers from Malaysia, Indonesia and Vietnam are currently at $705-710/t cfr Manila, a regional trader says. “But the Philippines cannot pay these prices,” the trader says. The last billet order took place at $665/t cfr Manila around 28 January.

Regional re-rolling mills cannot pay up the new billet offers because finished steel in home markets is trailing behind. These buyers' bids for billet are at $20-30/t lower than current billet offers. Kallanish assessed 5sp/ps or Q275 120/125/130mm square billet on Friday at $680-685/t cfr Manila, up $17.5 on week.