Indian integrated steel mills have been able to improve export realizations from sales to China. Though futures prices have dropped in China, curbing appetites for import billet in China in the middle of this week, prices for Indian billet are still assessed as acceptable for buyers, SteelOrbis has learned from trade and industry circles on Wednesday, March 10.
Market sources said that Chinese buyers have been willing to accept higher valuations for ex-India billets, but other Asian markets have not been seen to be responding to higher offers and Indian integrated steel mills have also been unwilling to aggressively push for export contract conclusions as realizations from local sales have continued to rise.
The sources said that billet prices in the local market have increased INR 500/mt ($7/mt) to around INR 38,900-39,700/mt ($533-545/mt) ex-works amid ongoing limited commercial sales volumes from integrated steel mills.
According to the sources, ex-India billet prices have moved up to the range of $560-565/mt FOB compared to the previous trade at $550/mt FOB.
A state-run integrated steel mill closed an export tender for 25,000 mt on March 9, with reports indicating highest prices received at $560-565/mt FOB, but the identity of the buyer could not be confirmed immediately. This price translates to around $590-600/mt CFR China, according to sources.
A western India-based integrated steel mill has reported a trade for a trading firm at a price of around $565-570/mt FOB. An Odisha-based steel mill has reported a sale with a China-based buyer at $560/mt FOB for May delivery, the sources said.
“Buyers in key Asian and Gulf markets are cagey in committing billet imports in view of rising freight costs. At the same time, Indian billet exporters are selective in concluding deals and only at higher levels as they have the option of improved sales realizations in local market sales,” an official with Steel Authority of India Limited (SAIL) said.
$1 = INR 72.90