Indian billet exporters have still been seeking to aggressively push up prices further due to a tightening of supplies and lower export allocations from some mills amid relatively high local prices.
The government mills, which have been the most aggressive in pushing volumes of semis overseas, have increased their targeted price levels to $670/mt FOB minimum, while some of them are expecting $680-690/mt FOB in the near future, versus targets of $650-660/mt FOB late last week. This new level is too high for buyers at the moment, while the tradable price level, which was $630-660/mt FOB last week, has remained stable on average, but has narrowed to $640-650/mt FOB this week so far.
Rebar prices increased after business resumed following the holiday in China and, even though gains have been below expectations, the market sentiments are positive and local Indian exporters consider that high prices around $670/mt FOB level will become acceptable in the future.
There has been no result of the billet tender for 30,000 mt of 150 mm billet yet, opened by a leading Indian mill last Friday. Some sources said that bids will hardly rise above $640/mt FOB, which is equivalent to $680/mt CFR China, including freight, while the initial target of the producer was $650/mt FOB.
An eastern India-based private mill has reportedly concluded a deal for 20,000 mt with an Asian trader at close to $645-650/mt FOB, the sources said, which. However, this could not be confirmed by the time of publication.
“Following surges in the local Indian market, local sales realizations from billets are almost at a par with export realizations. Mills are therefore under no pressure to sell overseas and hence are seeking to push up export prices, banking on a strong demand uptick in China,” a source at an Indian mill said.
“Export realizations of around $670/mt FOB are the minimum expectations from current volumes on offer, as domestic sales will be sustained as large mills have already hiked long steel product prices on the back of a demand rebound,” the source said.
$1 = INR 74.80
