Indian billet export activity has revived slightly in terms of volumes over the past week as local integrated steel mills have re-adjusted export allocations in response to falling local merchant prices of billets and rebar, SteelOrbis has learned from trade and industry circles on Wednesday, February 10.
The trade and industry sources said that local billet prices in India have softened by another INR 500/mt ($7/mt) to INR 33,700-34,000/mt ($461-466/mt) ex-works and secondary mills are becoming cautious as regards fresh bookings in view of falling rebar prices.
This along with buyers in China becoming active in restocking semis ahead of the Chinese holiday has prompted local integrated steel mills to increase offered volume overseas, even at marginally lower prices compared to trades earlier in the month.
Sources said that ex-India billet trades have been in the range of $510-520/mt FOB compared to $520-525/mt FOB late last week and $525-535/mt FOB early last week.
The sources said that a state-run steel mill based in southern India has closed an export tender, including two lots: one was for 150 mm billet, the other for bigger size material. The final price was $515/mt FOB or slightly above, according to sources, and though the financial transaction is yet to be signed it has been learned that the highest bid was from a trading firm representing a Chinese buyer.
An Odisha-based integrated steel mill has reported a supply contract for 30,000 mt with an Asian buyer at around $510/mt FOB, the sources said.
“The improvement in buying activity and trading volumes in Asian markets is a positive even if prices are slightly lower as it de-risks the local market, which is entering an oversupply zone,” an official at Jindal Steel and Power Limited said.
“We believe prices will start rising faster once business activity resumes after the Chinese holidays. We anticipate prices to rebound to a level of $540/mt FOB in the near term, offering a counterweight to soft demand in the local market,” he added.
$1 = INR 73.00