Indian billet exporting mills have abandoned submitting higher offers in the face of buyers’ resistance and fresh bids being lower on week-on-week basis, but most major exporters have mainly stayed away from aggressively pushing sales overseas against the backdrop of better margins in the domestic market.
The tradable level for ex-India billet has slipped by $10/mt on average over the past week to $495-505/mt FOB as bids from the major destinations have declined and exporting mills have reversed their earlier stance of submitting higher offers at up to $520/mt FOB.
The sources said that buying interest in major destinations like Southeast Asia and the Middle East has not been enough to support price increases and so a correction has been necessary.
According to sources, a government mill held an export tender for 30,000 mt on April 29 and it received the highest bid from a Middle East-based buyer at $505/mt FOB, lower than the expected $515-520/mt FOB.
An eastern India-based producer has reported a trade with an Asian buyer at $485/mt FOB, though the details of the tonnage have not been disclosed and market sources believe that it was for IF billet and for a very limited volume.
“Demand is moderate particularly in the Middle East. But from the sellers’ point of view a price increase is still not an option. The period before the May Day holiday also impacted trade activity,” a source at the mill said.
“Mills are very cautious in committing export sales at a time when the domestic market is surging. They will only conclude deals assessing margin positivity,” the source said.
Meanwhile, in the local market, billet trade prices have resumed a sharp uptrend riding on the back of the tightening of supplies, as a few large mills are going into maintenance shutdowns, which will tighten supplies of semis in the market. Billet trade prices have gained INR 1,100/mt ($13/mt) to INR 46,300/mt ($555/mt) ex-Mumbai and are up INR 500/mt ($6/mt) to INR 44,400/mt ($532/mt) ex-Raipur in the central region.
$1 = INR 83.40
