Ex-India billet prices have remained stable but the mood in the market has become more upbeat with deals working out better than expected, with buyers in key destinations perceiving the market to have bottomed out, while sellers are still waiting for a consolidation to increase their offer levels, SteelOrbis learned from trade and industry circles on Wednesday, September 18.
Ex-India billet prices have remained stable at $450/mt FOB over the past week, but the mood among sellers has improved further as bids have continued to increase gradually.
In particular, the sources said that improved deal levels have continued to prompt large mills to push higher volumes of semis for overseas sales as local market conditions have remained moribund. This was indicated by a government mill which held an export tender for 30,000 mt and got a highest bid at $452/mt FOB, slightly higher than $449/mt FOB for a similar tonnage in the previous week. Although the difference in price was not very much, it indicated that the market had possibly bottomed out with the recovery seen in China, while higher prices were being accepted in Asia and the Middle East.
Even a private mill reported an offer at $453/mt FOB, vindicating the forecasts of a market turnaround.
“Buyers are having more confidence in accepting a slightly higher price, prompted by the increase in prices in China. But we are not sure of its sustainability as the Chinese market is scheduled for a holiday early next month. Indication of a more sustainable uptrend can be gauged after that,” a source at an Indian mill said.
“But, in the meantime, exports have come as a good option to counter the extreme bearish local market conditions where demand for and prices of semis are weak in line with the trend in the rebar market,” he said.
The pessimism over the local market has been supported by the continued downslide in billet trade volumes and prices losing INR 500/mt ($6/mt) to INR 39,800/mt ($474/mt) ex-Mumbai and down INR 50/mt ($0.50/mt) to INR 37,400/mt ($446/mt) ex-Raipur in the central region.
$1 = INR 83.90
