Ex-India billet trading has remained inactive amid further weakening in the Asian region, with sellers not wishing to push for deals at lower levels, holding firm prices in anticipation of a market recovery, SteelOrbis has learned from trade and industry circles.
Ex-India billet prices have been maintained at $550-560/mt FOB amid almost silent market conditions, with only one trade reported at a much lower level.
The sources said that bids from the Southeast Asian market have been at $550-560/mt CFR, while China is asking for $500/mt CFR already. But Indian local sellers have been taking their cue from reports of semis prices improving in select western markets and Russian sellers attempting to push up prices and indications of cheap offers coming to an end.
At the same time, sustained gains in local billet prices in India, riding on the back of the strong consolidation in local rebar trade prices, have prompted mills not to push for overseas sales below the $530/mt FOB mark.
Sources in trade circles said that an eastern India-based mill has concluded a trade for 15,000 mt of concast billet at $520/mt FOB for end-of-August shipment to an Asian buyer, with the low-priced trade more in the nature of maintaining market relations than reflecting any trend among exporting sellers. The freight has been assessed at $55/mt at the lowest, so the CFR price level translates to around $575/mt. Most market sources believe that the deal was done last week, for this week this price in Asia has already been high for buyers.
Government-run mills have continued to refrain from floating export tenders for semis in the past several weeks, the sources said.
“Conditions remain weak for exports to the Asian destinations. But at the same time buyers’ options of cheap trades are also getting fewer with sellers seeking to push up prices. They have not been successful, but it indicates that current prices are not sustainable amid rising costs and inflationary pressures in most economies,” an official at a government-run mill said.
“It is difficult to put a timeframe but the down-cycle is ending and a rebound is next. Hence it is better to hold back selling at low prices and to increase allocations for local sales,” he said.
Sources among mills and traders reported further gains in local billet prices averaging around INR 500/mt ($6/mt), taking the prices to INR 50,000/mt ($628/mt) ex-Mumbai and 50,300/mt ($632/mt) ex-Raipur in the central regional market.