India’s billet export trading activity has indicated a sharp downturn during the past week, caught in a stalemate between buyers’ resistance to high prices and sellers’ refusal to adjust export offers to conclude deals.
According to market sources, Chinese buyers have pulled out from the market, declining to conclude deals at higher prices while most Indian integrated steel mills have refused to adjust export offers to conclude deals.
The sources said that only a few modest volume deals have been sold during the past week, but most exporters have preferred not to conclude transactions, anticipating higher prices will be sustained and that the pause in trading activity will be short-lived.
Indian state-run firm SAIL has opened a tender for 20,000 mt of 150 mm billet today, July 22, while yesterday the same company held another tender for about 19,000 mt of 125 mm billet, which will be shipped from Haldia port. SteelOrbis has learned that both tenders are still open for receiving bids. The seller is targeting not below $395/mt FOB for 150 mm billet.
Market sources said that an eastern India-based steel mill concluded an export deal for a relatively small volume of 15,000 mt at below last week’s level of $385-390/mt FOB, but this was assessed by market sources as being an exception. Also, an Odisha-based steel mill has concluded a deal for 12,000 mt of billet with a Singapore-based trading firm at a price estimated at slightly below $385/mt FOB, which also does not reflect the current market price level, the sources added.
The tradable value from major Indian mills is still at $385-395/mt FOB. “Sellers may wait to sell. Now the price [acceptable by China] is $415/mt CFR [this corresponds to $390/mt FOB or slightly below from India], but it doesn’t take long for this to change,” an Asian trader told SteelOrbis.
“Exporters are unlikely to adjust export offers in a hurry. Taking their cue from improvements in local billet and rebar prices in China, the absence of Chinese buying is expected to be reversed soon,” an official at an eastern Indian private steel mill said.