Indian billet exporters have been successful in rapidly increasing prices significantly above the $600/mt FOB mark, with Asian trading firms aggressively concluding fresh bookings in anticipation of strong demand and further price increases after the holiday in China, SteelOrbis has learned from trade and industry circles.
Ex-India billet prices have increased to $609-615/mt FOB this week, up from $600/mt FOB a week ago.
“Buying from end-users in Asian markets has been slightly muted. But trading firms have been very active and aggressively buying to build up stocks betting on a sharp rise in spot prices in China after the forthcoming holidays, on the back of further increases in raw material costs and increased output from rolling mills,” a Mumbai-based trader said.
“Buyers in China and a few other Asian markets are accepting higher prices. Target valuations of Indian exporters of $700/mt on CFR basis and higher are a distinct possibility in the short term,” the trader said.
Sources said that an Indian government-run blast furnace operator has reported that an export tender for 30,000 mt of 150 mm billets has received the highest bid of $615/mt FOB for March shipment from a Singapore-based trading firm.
Around 60,000 mt of blast furnace-origin billets were traded at $609/mt FOB last week, a few market sources confirmed. At least 30,000 mt of this volume were already offered to Turkey.
“The targeted sale destination for Indian billet is the Middle East,” one of the international traders said about one of the latest Indian tenders.
An eastern India-based integrated blast furnace operator has reported a trade for 30,000 mt with a China-based trading firm at over $610/mt FOB, the sources said, but this information could not be confirmed by the time of publication. Taking into account the freight of $40-50/mt from India to China, this price is $650-660/mt CFR without the trader’s margin, and is too high for now. “China can’t accept these prices. The current level is $640/mt CFR max,” a local source from China said, but added that the outlook is positive for the post-holiday period.
Meanwhile, billet prices have continued to surge in the local market in India on the back of sustained gains in rebar prices and rising demand. Prices have surged by INR 500/mt ($7/mt) to INR 45,550/mt ($610/mt) ex-works, sources said. In the central regional market of Raipur, customers were heard to be sourcing billets at prices as high as INR 47,100/mt ($632/mt) owing to the limited availability from integrated steel mills.
$1 = INR 74.56
