Indian billet exporters have been deferring attempts to hike export offers, following uncertain cues from China and limited available export allocations amid the tightening of supplies of semis and since prices in the local market are still surging, SteelOrbis learned from trade and industry circles on Wednesday, October 9.
Ex-India billet prices have been assessed at $475-500/mt FOB, moving up by $10/mt over the past week, and, though sellers are still optimistic about targeting the $500/mt FOB mark, they are heard to be holding back submitting offers at higher levels as cues from China are uncertain and a definite trend is only expected to emerge once business activity picks up.
Furthermore, large Indian integrated mills have seen a sharp drawdown on inventories of semis and so they have lowered their available export allocations after several consecutive weeks of rapid high-volume merchant trade in the local market at higher prices, with the rebar market continuing to surge, the sources said.
They said that an Odisha-based integrated mill has reported a trade for 20,000 mt at $475/mt FOB and, even though it was $5/mt higher than a similar trade a week ago, it was lower than expectations and most other sellers are following suit and holding back offers until such time upside potential is realized in major destinations overseas.
“The export market is looking good despite some uncertainties in China which is just returning back from the holidays. But it is not good enough for local sellers who are seeing rapid high-volume local sales at prices better than current workable prices overseas,” a source at an Indian mill said.
“Furthermore, sellers can afford to hold back export offers as inventories are very low and they can wait for the export market to consolidate higher to the expected level of $500/mt,” the source said.
Meanwhile, in the local market, billet trade prices have continued to surge unabated amid rising demand for semis from secondary mills as a derived demand from the robust rebar market. Billet trade prices have gained INR 1,300/mt ($15/mt) to INR 45,000/mt ($536/mt) ex-Mumbai and are up INR 850/mt ($10/mt) to INR 41,950/mt ($499/mt) ex-Raipur in the central region.
$1 = INR 84.00
