India’s billet export activity has lapsed into limbo in the past week, with integrated steel mills maintaining offers, but, barring stray deals, they have refrained from responding to bids, unsure of their plant operational levels in the coming months and whether they will be able to meet delivery commitments, SteelOrbis learned from trade and industry circles on Wednesday, April 28. Meanwhile, local billet prices decreased sharply.
The price level from Indian integrated steel mills is $595-600/mt FOB, based on the latest billet tender closed late last week at $598.5/mt FOB. But the new workable levels will be at $620/mt FOB minimum, following an increase in the Asian market after the news of the import duty cut to zero in China, most sources agree. Lower prices are available only for limited volumes of Indian IF billet.
The sources said that, with buyers seeking bookings for June-July shipments, local integrated steel mills are not sure of meeting delivery commitments as production planning has become impossible for the coming months in the absence of oxygen available to charge blast furnaces.
Most steel mills are unsure even if their plants will remain operational over the next two months in view of the pandemic assuming disaster proportions and steel mills already cutting down output giving priority to the medical emergency and diverting their entire oxygen supplies, the sources said.
An Indian state-owned mill closed a tender for 30,000 mt of 150 mm billet at $598.5/mt FOB late last week, according to sources. This week, the producer has held another tender, which will be finalized by May 3. The target price is much higher now, at $620/mt FOB minimum, SteelOrbis has learned. The previous booking of ex-India billet to China was at $652/mt CFR last week, but after China cancelled the two percent import duty on non-ASEAN billet, the workable level is expected to be $670-680/mt CFR.
Among the stray deals reported in the market over the past week was also a trade for IF billet at $570-580/mt FOB for June shipment.
Fears of a sharp demand depression in the local finished steel market in India has triggered a slump in local commercial billet prices, which have declined by INR 1,600/mt ($21/mt) to INR 35,800-36,600/mt ($479-490/mt) ex-works, sources said. The level excludes 18 percent Goods and Service Tax (GST).
$1 = INR 74.70