Chinese buyers have continued to show interest in import billet purchases and have been booking ex-India billets at higher prices, while a bullish export outlook has been sustained among Indian sellers, though billet buyers in other key destinations like Southeast Asia have been cautious, SteelOrbis has learned from trade and industry circles on Wednesday, March 31.
Ex-India billet price levels have increased to $555-580/mt FOB, up by $5-10/mt week on week.
Sources said Chinese buyers have been seen to be more willing to pay higher prices for import billet amid reports of falling local billet inventories and growing local prices. Indian integrated steel mills have offered billet to China at $580-590/mt FOB and concluded some modest-volume bookings. Moreover, some offers have already emerged at $600-610/mt FOB in the market, which is too high in the current market conditions, sources said.
In contrast to the Chinese market, buyers in other Asian and Gulf markets were seen to be resisting Indian sellers’ attempts to push trades at higher prices. The tradable value for ex-India billet in Asia and the Gulf region was at $550-560/mt FOB, sources said.
The Indian rupee falling to its weakest level in four weeks against the US dollar at INR 73.40 to the dollar has made Indian sellers more willing to export.
The sources said that an eastern India-based integrated steel mill has reported a trade of around 30,000 mt with a Chinese trading firm at a price of around $580/mt FOB or slightly below for May shipment.
A Maharashtra-based steel mill has reported a trade to Asia at $570-580/mt FOB, though no confirmation or further details have been disclosed, the sources added.
The tradable level for non-ASEAN billet, which is subject to two percent import duty, is about $615/mt CFR China this week, up from $605-610/mt CFR last week.
“Strong prices and demand in China, as well as possible export rebate cuts, will drag up prices across the Asian markets. This promises a big positive outlook for Indian exporting steel mills at a time when local demand is uncertain,” an official at Steel Authority of India Limited (SAIL) said.
Meanwhile, weakness has persisted in the local Indian billet market in view of the absence of commercial buying by secondary long product producers, with billet prices losing another INR 500/mt ($7/mt) to INR 37,600-38,400/mt ($512-523/mt) ex-works.
$1 = INR 73.40