Ex-India billet trade activity has remained brisk, with mills increasing offer volumes overseas, but deals have still been concluded at low levels as a negative mood prevails across most destinations, SteelOrbis learned from trade and industry circles on Wednesday, February 21.
Indian private mills have joined government-run producers in increasing offer volumes for overseas sales, with offers at $510-520/mt FOB, but most tradable levels have remained lower, in the range of $500-510/mt FOB, unchanged over the past week.
A government-run mill has floated two “live tenders” over the past one week aggregating at 45,000 mt, while a second government mill has also floated an export tender for 20,000 mt, to close later this week, with price expectations near $505/mt FOB.
The sources said that an Odisha-based mill has reported a trade to the Asian market at $500/mt FOB, while another eastern India-based mill has concluded a smaller trade for delivery to the Middle East at $510/mt FOB.
A private multi-commodity trading firm has reported a deal with an undisclosed buyer at $508/mt FOB, the sources said.
“Prices are low because there are more players across markets pushing high-volume sales. Local mills are prudently aggressive in competing overseas, as the margins for conversion of semis to finished steel in domestic sales are not very good. Hence, increasing volume is a strategic decision and hence we are seeing more mills entering exports,” a source at an Indian mill said.
“The conditions in markets will change as business in China gathers pace after the holidays. We are not sure of the direction of that change. It will be determined by steel margins in China and set a new direction in the market,” he added.
Meanwhile, in the local market, trade billet prices have staged a smart recovery, riding on the back of improvements in rebar prices, gaining INR 1,000/mt ($12/mt) to INR 42,300/mt ($510/mt) ex-Mumbai and up INR 550/mt ($7/mt) to INR 39,400/mt ($475/mt) ex-Raipur in the central region.
$1 = INR 83.00
