Ex-India billet offers were officially kept unchanged but actual deals worked out only at discounts as sellers’ optimism on a revival was belied by overall renewed weakness in key global producing regions coupled with slowdown in movement of stocks in the local market, SteelOrbis learned from trade and industry circles on Wednesday, August 20.
Ex-India offers were kept stable by large exporting mills in range of $440-450/mt FOB, but unlike in earlier weeks, some sellers were more amenable to negotiate lower bids and conclude discounted deals.
According to the sources, discounted deals which worked out average $10-15/mt lower on FOB basis were also driven by local merchant trade of semis cooling down after below expected rise in finished steel prices.
A Tier I eastern India based mill reported a sale of 20,000 mt to a trader at $430-435/mt FOB net of discount, the sources said.
Another large integrated mill reported a deal for 30,000 mt for the Middle east market at $430/mt FOB or slightly below net of discount, the sources added.
“The optimism of a strong rebound in semis in the Asian region has not materialized even after a long waiting by sellers who are now agreeing to accept lower offers. The new trend has also been triggered in slowdown in the local market, in terms of traded volumes,” an Indian seller said.
“The market, at least in Asia, has moved in favor of buyers after prices failed to hold in China. There are also pressures of inventories of semis emerging among some of the larger Indian mills. These elements offer some more downside risks to price in the coming weeks,” he added.
Meanwhile in the local market, billet trade price was up a marginal INR 100/mt ($1/mt) at INR 40,300/mt ($463/mt) ex-Mumbai and marginally down INR 100/mt ($1/mt) at INR 37,400/mt ($430/mt) ex-Raipur in central region amid significant decline in trade volumes across regions.
$1= INR 87.08