Ex-India billet exports led by government mills have gained momentum with sellers achieving higher prices. The increase has remained below the targets of mills, and towards the close of the week resistance from some buyers to the new higher levels has been reported, with a few large-volume offers failing to be converted to deals, SteelOrbis learned from trade and industry circles on Wednesday, January 11.
The ex-India billet reference price has reached $525-540/mt FOB this week, versus $510-520/mt FOB last week.
The positive mood was set by the closing of an 30,000 mt export tender on January 10 by a government-run mill and, though the final contract with the successful bidder is yet to be concluded, trade sources said that the highest bid was at $525-530/mt FOB, which was an improvement over last week’s tradable level of $510-520/mt FOB.
Similarly, an Odisha-based integrated mill concluded a spot sale with a Gulf-based buyer for 25,000 mt at $525/mt FOB.
They said that, though deal price levels were improving week on week, the rate of rise was still slow from the sellers’ perspective as they expected $540-560/mt FOB at least.
The sources said that a western India-based mill is heard to have concluded a trade for 35,000 mt to a trader at $540/mt FOB, but the high price achieved is still being considered ‘destination specific, buyer specific’ rather than an ‘outlook indication’, with the expected sales destination thought to be Turkey, though this has not been confirmed by the time of publication.
“The overall mood in billet exports is good. The target for most sellers has yet to be achieved because prices have gained rapidly and are expected to slow down a bit,” an official at a private mill said.
“Another positive is that ex-India billet at current prices is still very competitive, lower by at least $20-30/mt on FOB basis compared to other sellers. But with the local rebar market getting robust and secondary mills increasing merchant buying, export availability at integrated mills will get tighter,” he said.
Meanwhile, in the local market, billet prices have lost ground, with this attributed to a correction after a prolonged bullish run even though trade volumes have remained on the higher side. Billet prices have lost INR 1300/mt ($16/mt) to INR 49,200/mt ($597/mt) ex-Mumbai and are down INR 850/mt ($10/mt) to INR 46,650/mt ($566/mt) ex-Raipur in central region.
$1 = INR 82.40
