Indian billet exporters have maintained prices stable, but were heard to be holding back deals anticipating a revival in the Asian market. After the last trade at $600/mt FOB and reports that diversions of cargoes to alternative destinations from China are easing, Indian exporters expect that prices will rebound and, as a result, they canceled some recent tenders, SteelOrbis has learned from and industry circles.
One stray deal by a government-run mill was reported at $600/mt FOB late last week, triggering optimism over a revival in buying and prices. The market was also keeping a close watch on an export tender for another 30,000 billet from the same producer, which has to be closed on Wednesday. Unofficial reports were indicating that that the targeted price was $610-620/mt FOB, but the final results of the auction have not been disclosed.
Another Indian mill “most likely will cancel its 150 mm tender, expecting $620/mt FOB,” an Asian trader said, adding that the sentiment in Asia has improved, but not that much.
The SteelOrbis reference price for ex-India billet has been settled at $600/mt FOB this week until new deals are done, up by $5/mt on average from last week.
“Pressures on ex-India billet prices are easing. But the upside potential will be set by ongoing negotiations on imports in China. Deals on distressed billet cargoes to Asian markets have run their course now there are very few such tonnages. Diversion of cargoes is becoming reduced and buyers are starting import negotiations at strong positives. However, local exporters are still awaiting a definitive uptrend to emerge and price consolidation above $600/mt FOB before increasing activity in exports,” a source at a government-run steel mill, Rashtriya Ispat Nigam Limited (RINL), said.
“Apart from prices, the weakening of billet prices in the local market is also expected for sellers to seek pushing higher volumes overseas. But price expectations of $630-640/mt FOB are far more tempered by cautious optimism in the short term,” the sources said.
In the local market, merchant sales billet prices have continued to seek lower levels in India, losing INR 1,000/mt ($13/mt) to INR 41,000/mt ($551/mt) ex-works, sources said.
$1 = INR74.40
