Belying sellers’ expectations of a revival, ex-India billet prices have been dropped in reaction to fresh negativity across Asia and the Gulf region, but deals still remained elusive with buyers preferring to wait, SteelOrbis learned from trade and industry circles on Wednesday, July 5.
While government mills had retreated and no new export tenders were floated during the past week, private mills were heard to have submitted offers in the range of $500-510/mt FOB with some slight discounts from these levels also possible, compared to $510-530/mt FOB a week ago. But with bids submitted at still lower levels, no trades were confirmed in the market.
According to the sources, in the Asian region, cheaper alternatives have emerged for ex-Russia and ex-Indonesia material, while business activity is still to pick up in the Gulf after the holidays of last week.
“The window for increasing prices seems to have been deferred by the increase in supplies in key destinations and the softening of demand at the same time. We don’t see a major fall in demand in Asia and some revival in the Gulf is also expected in the coming weeks. But our assessment is that it will not be sufficient for sellers to attempt a price increase,” an official at a government mill said.
“We are monitoring overseas markets closely through real time data processing. A decision on new offers will be taken over the next few days,” he said.
At the same time, the pressures to push volumes overseas to check inventories have been eased by the gains in merchant sales prices in the local market, following the increase in trade volumes and the slight fall in supplies from integrated mills. Billet trade prices are up INR 500/mt ($6/mt) to INR 45,400/mt ($554/mt) ex-Mumbai and up INR 400/mt ($5/mt) to INR 43,650/mt ($532/mt) ex-Raipur in the central region.
$1 = INR 82.00