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Singapore rebar importers pause on currency weakness - 5 October 2011

Singapore rebar importers are hesitating to make any new import bookings because of the near 9% gain in the US dollar’s value month-on-month. “The currency factor has rendered imports uncompetitive,” a trader tells Steel Business Briefing.

He cites this as the main reason for the market slowdown, despite steady rebar demand due to ongoing construction projects in the republic.

“Importers are in no hurry to buy. They think that the strength of the dollar is temporary and so would rather wait,” another says. Importers will only book more costly imports if they think domestic rebar prices will be raised. However, continuing fears of a global slowdown and its resulting impact on steel demand continue to depress market sentiment.

Turkish suppliers have recently lowered their theoretical-weight rebar offer prices to around US$725/tonne cfr Singapore, down US$20-25/t from last month. Domestic rebar prices are prevailing at around S$930/t (US$710/t) delivered and SBB is told that sole domestic producer, NatSteel, is planning to hike prices by S$15/t.

Some 10,000-20,000 tonnes of 10mm and up in diameter rebar from Korea was booked at US$725-730/t cfr Singapore in mid-September. Chinese 16mm and up boron-added rebar was offered at US$715-720/t cfr Singapore two weeks ago.

Rebar import prices could fall further because there is room for exporters who are making forex gains and are using more domestic scrap for their feed. “International scrap prices appear to be weakening now,” a trader notes.

 

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