Sentiment among Indian billet exporters has continued to remain bearish, but more local sellers including government-run mills have returned with offers, However, buyers’ price ideas in the key markets have fallen further, limiting trading opportunities for India, SteelOrbis has learned from trade and industry circles.
Ex-India billet reference price levels have settled at $480-520/mt FOB, with the midpoint at $500/mt FOB as, even though official offers from mills have been at higher levels, the weakening of buyers’ price ideas in major markets has exerted pressure. The price is $35/mt on average below the level seen last week.
According to the sources, though official offers from private mills remain in the range of $530-550/mt FOB, compared to offers of $550-560/mt FOB a week ago, the tradable level has dropped below the $500/mt FOB mark.
The return of sellers was led by government-run steel producer Rashtriya Ispat Nigam Limited (RINL), which, after close to two months, floated an export tender for 30,000 prime concast billet with bids closing early next week. Sources believe that the government-run mills in India will target $510-520/mt FOB, but hardly lower.
Sources also said that one eastern Indian mill reported a trade for 15,000 mt of billet at $480-490/mt FOB, against an initial offer in the range of $500-510/mt FOB. The final trade destination is unknown by the time of publication. “It's possible for IF for Africa, but definitely not for Asia,” a trader commented in relation to the deal. The tradable levels for imported billet in Southeast Asia have hit $505-515/mt CFR Manila, which translates to around $455/mt FOB for India, taking into account freight of $55/mt minimum.
“The presence of a greater number of export offers despite the continued rise in local merchant prices is an indication that inventories at mills are rising more rapidly than sales growth,” an official at a government-run mill said.
“In the key markets of Asia and the Gulf, demand remains very weak, and hence sellers are finding it a challenge to push up workable prices,” he said.
Meanwhile, local Indian billet trade prices have edged up INR 300/mt ($4/mt) to INR 49,800/mt ($625/mt) ex-Mumbai.
$1 = INR 79.70
